Must-know stablecoin knowledge for 2025 📕 In what forms will stablecoins enter our lives? ❓

Stablecoins, as a bridge between the crypto world and real-world finance, are accelerating their penetration into daily life through the following three directions. Their core advantages lie in cross-border efficiency, value stability, and financial inclusion, but they also come with regulatory and technical risks. Here is a detailed analysis:

🌐 1. Cross-border remittances: Disrupting traditional payment efficiency

Low cost and instant settlement
Traditional cross-border wire transfers take 3-5 days, with high fees (about 120 HKD per transaction) and significant exchange rate losses. Stablecoins (such as USDT, USDC) achieve minute-level settlement through blockchain, reducing fees to 1/10 of traditional methods (about 8 HKD), with transparent exchange rates.
Case studies:

Filipino workers receive USDT directly through Grab Pay wallet, instantly converting to pesos for daily expenses, bypassing bank intermediaries;
Corporate cross-border payments (such as Vietnamese manufacturers paying Chinese suppliers) are completed within 20 seconds through compliant stablecoin networks (such as Hong Kong's mBridge), while traditional processes take 3-5 days.

Compliance infrastructure improvement

Hong Kong: The Stablecoin Ordinance effective August 1, 2025, requires licensed issuers (such as Guotai Junan USDH) to have 100% reserve assets and connect with digital RMB cross-border pilots, ensuring security and liquidity;
United States: The GENIUS Act mandates stablecoins to be anchored to cash or short-term debt, included in anti-money laundering regulations, providing new standards for interbank settlements.

Challenges:
Compliance costs may increase fees, and policy restrictions in some regions (such as mainland China prohibiting non-compliant stablecoin circulation).

The table below summarizes the core advantages of stablecoins in the field of cross-border remittances:
| Comparison Dimension | Traditional Cross-border Remittances | Stablecoin Cross-border Payments |
| --------------------- | -------------------------- | -------------------------- |
| Settlement Time | 3-5 days | Minute-level (fastest 20 seconds)|
| Fees | About 120 HKD per transaction | About 8 HKD per transaction (reducing by 90%+) |
| Exchange Rate Transparency | Not transparent, high implicit costs | Real-time transparency, traceable on-chain |
| Regulatory Protection | Bank system regulation | New legislation in Hong Kong/US ensures protection |

📉 2. Combating inflation: The 'digital safe-haven asset' in emerging markets

Currency substitution in high inflation countries

In countries like Argentina and Nigeria with annual inflation rates exceeding 200%, people convert their salaries to USDT to avoid devaluation. For example, Argentine workers convert their salaries to USDT upon receipt and even use it for daily expenses, with crypto asset adoption rates three times the global average;
Unbanked populations in Africa hold stablecoins through mobile wallets as their first 'financial identity', bypassing traditional financial barriers.

Stability mechanisms and risks

Advantages: Fiat-backed stablecoins (such as USDT, USDC) are pegged to the US dollar, with volatility controlled within ±0.5%, making them more stable than local currencies;
Risks: Transparency of issuer reserve assets is insufficient (such as USDT's trust crisis due to opaque commercial paper reserves), or encountering black swan events (such as the 2023 Silicon Valley Bank collapse causing USDC to briefly de-peg).

💰 3. Investment: From basic tools to structural opportunities

As a safe-haven tool and yield carrier

On-chain hedging: When Bitcoin crashes, investors convert assets to USDT to temporarily avoid risks, waiting for the market to stabilize before reinvesting;
DeFi wealth management: Platforms like Aave and Compound allow staking USDC to earn annual yields of 3%-7%, higher than traditional savings.

Expansion of financial scenarios for compliant stablecoins

Securities settlement: Guotai Junan USDH is directly used for Hong Kong/US stock trading, shortening T+2 settlement to minute-level, and issuing high-yield derivatives as collateral (annual yield higher than money market funds by 1.5%-3%);
RWA (Real World Asset) tokenization: Stablecoins become settlement media for on-chain transactions of real estate, bonds, etc., enhancing liquidity.

Market investment opportunities

Concept stocks surge: Hong Kong stablecoin licenses drive stock prices of New Fire Technology (up 100%) and Guotai Junan International (up 400%) to soar;
US stock beneficiaries: Circle (USDC issuer) surged 500% after listing, and Coinbase is favored by institutions due to stablecoin trading revenue accounting for 15%.

🌍 4. Future challenges and regional differences

Regulatory divergence:
- The US and Hong Kong promote licensing, strengthening reserve audits and bankruptcy protection;
- Mainland China prohibits non-compliant stablecoins, limiting enterprise applications (such as Ant, JD) to cross-border scenarios, with personal use restricted.
Technical risks: Algorithmic stablecoins (such as UST) collapsed due to mechanism flaws, with fiat-collateralized types gaining more market trust.
Strengthening dollar hegemony: 99.75% of global stablecoins are pegged to the US dollar, with the US guiding stablecoin fund allocation to US bonds through the GENIUS Act, consolidating the dollar's position.

💎 Conclusion: The 'three-layer penetration' path of stablecoins

The core path for stablecoins entering life is clear:

Efficiency layer → Reducing costs and speeding up cross-border remittances;
Demand layer → Safe-haven necessity in inflationary countries;
Financial layer → Innovation in investment tools and compliant financial products.

Whether they can be popularized in the future depends on the pace of regulatory implementation (such as Hong Kong tax incentives), technical security (such as 100% reserve audits), and user education (avoiding high-yield scams).

Personal opinion, not investment advice

Access to virtual asset trading: $GUOTAI JUNAN I(01788.HK), $Futu(FUTU.US), $FOSUN INTL(00656.HK)$CM BANK(03968.HK), $VICTORY SEC(08540.HK) and others;
Stablecoin issuance applicants: Yuan Technology related ($ZA ONLINE(06060.HK), $GOFINTECH QUANT(00290.HK), $Z FIN(01168.HK) and others), $JD-SW(09618.HK), $STANCHART(02888.HK), domestic state-owned enterprises and other applicants;
Hong Kong virtual asset exchanges (VATP licensed): $OSL GROUP(00863.HK), $HKE HOLDINGS(01726.HK)$LIANLIAN(02598.HK), $Futu(FUTU.US), $PUXING ENERGY(00090.HK) (holding Hashkey);
Downstream applications of stablecoins: $YEAHKA(09923.HK), $GOLDSTREAM INV(01328.HK), $LIANLIAN(02598.HK)
RWA related: $CRYPTO FLOW(08198.HK), $SENSETIME-W(00020.HK), $ETHK LABS INC.(01931.HK), $PHANCY(06682.HK), $LINEKONG(08267.HK), $RUIFENG RENEW(00527.HK), $FOSUN INTL(00656.HK), $GOFINTECH QUANT(00290.HK), $SYNAGISTICS(02562.HK), $YUNFENG FIN(00376.HK), $DL HOLDINGS GP(01709.HK), $EASOU TECH(02550.HK), $VOBILE GROUP(03738.HK), $CMGE(00302.HK), $GCL TECH(03800.HK), $LINKLOGIS-W(09959.HK), $COOLPAD GROUP(02369.HK), $GREENLAND HK(00337.HK), $DMALL(02586.HK)
US stock stablecoin direct issuers: $Circle(CRCL.US)
US stock trading platforms and ecosystem partners: $Coinbase(COIN.US), $Robinhood(HOOD.US)
US stock traditional financial institutions deploying stablecoins: $JPMorgan Chase(JPM.US), $Bank of America(BAC.US), $Interactive Brokers(IBKR.US), $Citigroup(C.US)
US stock innovative technology and infrastructure companies: $Mega Matrix(MPU.US)
US stock payment and fintech companies: $Paypal(PYPL.US), $SoFi Tech(SOFI.US), $Visa(V.US)

Circle (CRCL)
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