From Niche to Necessity: How Stablecoins Hit $250B and Redefined Money

Stablecoins have gone from niche to mainstream, and the numbers prove it.

In the past year, the stablecoin market has surged to $250 billion, fueled by the (GENIUS) Act, a US law that doesn’t just acknowledge stablecoins, it defines them: what they are, who can issue them, and the standards they must meet. That clarity turned regulatory uncertainty into a launchpad. Institutions that once hesitated now have a clear rulebook, and they’re using it to issue, integrate, and innovate at scale.

This post dives into how stablecoins actually work and why they’ve become more than a niche crypto tool. We’ll look at their role in protecting savings where local currencies falter, in moving money across borders without the usual delays and costs, and in powering new forms of digital finance that can potentially generate returns without sacrificing speed.

Here’s what you should know.

How stablecoins differ from cash

#1 Saving with stablecoins can enable financial stability in unstable economies.

One of the most compelling use cases for stablecoins is their ability to shield individuals from severe currency volatility. For example, in countries with high inflation, using a stablecoin backed by a more stable currency, such as the U.S. dollar, can be a way to hold money while preserving its value.

People can send and receive stablecoins, and use them to pay for necessities. And when users need physical currency, on and off-ramps, like the ramps available on the Stellar network, allow them to convert crypto-to-cash, and vice versa.

Often when a country is experiencing political or economic instability, its residents may not have access to their local banks or may not want to hold cash for safety reasons. Solutions like the Stellar Disbursement Platform (SDP) can be used to send payments so that people can hold stablecoins, which can protect the assets from local inflation. Such solutions also provide peace of mind for people, particularly refugees, in regions of instability. They are able to safely hold and access their assets without carrying physical cash. Then, when cash is needed, they can convert their crypto to cash at a participating MoneyGram location.

#2 Near instant settlement makes stablecoins more efficient to send or receive

Payments made with stablecoins can be less expensive and faster than payments made with fiat through the traditional banking system. Many financial institutions in the United States use a system created in 1972 called Automated Clearing House (ACH), to electronically transfer funds between banks. While widely used, ACH can introduce delays and additional fees.

Stablecoins, on the other hand, operate on blockchains, which process payments almost instantly, removing that middle man. That means payments made with stablecoins can settle more quickly and at a fraction of the cost of traditional ACH transfers. This efficiency is part of the reason institutions like JPMorgan Chase are exploring the use of blockchain technology and stablecoins to settle payments.

#3 Faster, cheaper cross-border payments powered by stablecoins

The efficiency offered by stablecoins is especially important in the case of cross-border payments, or remittances. While sending money domestically through the traditional system can be costly and time-consuming, sending money internationally has additional steps. Stablecoins allow money to move across borders, almost instantly.

Stablecoin-powered cross-border payments have a real impact on everyday lives. Whether supporting family members abroad, running a small business, or receiving wages, people can access their money quickly and without the burden of high transfer fees, giving them more control and flexibility over their money.

One example is Decaf, a wallet built on the Stellar network, that allows people to send and receive cryptocurrency. Once someone receives a stablecoin such as USDC, they can off-ramp that stablecoin into local fiat currency at any time. Each week, $200,000 in USDC on the Stellar network is off-ramped to power transactions in local economies.

#4 Programmability expands the power of stablecoins beyond the simple stability of the dollar

The passage of the GENIUS Act marks an exciting new era of stablecoin acceptance. However, stablecoin products are already evolving beyond what the GENIUS Act covers. An emerging wave in the industry known as “Stablecoin 2.0” focuses on bringing features like embedded yield that allow users to earn interest while holding a stable asset.

Some are backed by interest-bearing assets. Some are integrated with DeFi protocols, transforming stablecoins from simple payment tools into vehicles for value preservation and growth, all while maintaining a 1:1 peg.

One example, Etherfuse, uses the Stellar network to support stablecoin-like products through tokenized bonds. These onchain assets provide yield, combining the benefits of traditional finance with the efficiency of blockchain.