For years, stablecoins were pitched as the missing link between volatile cryptocurrencies and everyday payments. In 2025, that vision moved closer to reality. Total transaction volumes for stablecoins jumped 72 percent to $33 trillion (€28 trillion), according to data from Artemis Analytics. The surge was driven by adoption from institutions, banks, and even former crypto sceptics.
Stablecoins are crypto assets designed to hold a steady value by pegging themselves to a real-world asset, most often the US dollar. Unlike other cryptocurrencies, they are backed by reserves such as dollars or Treasury bills, allowing holders to redeem them on a one-to-one basis. Over 90 percent of stablecoins in circulation today are dollar-pegged, with Tether’s USDT (market cap $186 billion) and Circle’s USDC ($75 billion) dominating the market. In 2025, Circle processed $18.3 trillion in transactions; Tether handled $13.3 trillion.
A report from venture capital firm a16z estimated that, after adjusting for non-organic activity, stablecoins facilitated at least $9 trillion in genuine user payments last year — an 87 percent increase from 2024. That volume, the report noted, is more than five times PayPal’s throughput and over half of Visa’s.
Divergent government responses
As stablecoins gain traction, governments are taking sharply different approaches. The International Monetary Fund has called for international cooperation, but the EU, the United States, and China are each charting their own course.
In the European Union, the European Central Bank is pressing ahead with a digital euro. In October 2025, ECB President Christine Lagarde announced the end of the preparation phase, stating: “We have done our work, we have carried the water, but it’s now for the European Council and certainly later on for the European Parliament to identify whether the Commission’s proposal is satisfactory.” The Eurosystem aims for a first issuance in 2029. Unlike China, the EU has not banned private stablecoins; instead, they fall under the Markets in Crypto-Assets (MiCA) regulation, which requires issuers to obtain a Crypto-Asset Service Provider licence by July 2026.
The United States, under President Donald Trump, has taken the opposite tack. In January 2025, Trump signed an executive order prohibiting federal agencies from promoting or issuing a central bank digital currency. That cleared the way for private dollar stablecoins to dominate without official competition. In July, the GENIUS Act created a comprehensive regulatory framework requiring stablecoin issuers to maintain full one-to-one reserve backing with liquid assets. Treasury Secretary Scott Bessent argued that stablecoins “will buttress the dollar’s status as the global reserve currency, expand access to the dollar economy for billions across the globe, and lead to a surge in demand for US Treasuries.”
China, meanwhile, has banned private stablecoins outright and is expanding its digital yuan (e-CNY), first piloted in 2019. The approach reflects Beijing’s preference for state-controlled digital money over privately issued alternatives.
According to McKinsey, cash still accounts for 46 percent of global payments in 2025, but non-digital transactions are declining, especially in developed economies with robust digital infrastructure. The rise of stablecoins and central bank digital currencies reflects a broader shift toward digital payments — and a growing divergence in how the world’s largest economies choose to manage that transition.
