Stablecoins: Meaningful Innovation in Payments

Stablecoins Bring 'Meaningful Innovation' to Global Payments

14 May 2025 at 19: 41

Reading time: 2 minutes

Stablecoins are undergoing a remarkable transformation from tools for crypto traders to the backbone of global finance, as I recently highlighted during a panel discussion at Consensus 2025 in Toronto. To me, the rise of stablecoins represents a true “evolution” in the way money moves globally. It offers an alternative method for making payments in US dollars, in a way that is both frictionless and cost-effective.

A new approach to payments

With the launch of RLUSD, a fully collateralized and regulated stablecoin, Ripple a significant step towards replacing outdated, fragmented cross-border payments systems. The increasing acceptance of stablecoins in payments has been a major driver for me to expand our activities in this sector.

Efficiency of the current financial system

I can’t stress enough how inefficient our current financial system is. It’s far too difficult to move money around the world. Stablecoins are the solution and I believe we are at a tipping point.

Future of Yield Generating Stablecoins

An interesting development is the rise of yield-bearing stablecoins. This is the next frontier, but regulations are still lagging behind. It is important that people who hold their money can also earn a return on it. However, we see that regulations differ from region to region. For example, USDG cannot provide a return in the European Union according to MiCA rules.

At Ripple, we also want to offer a yield on our stablecoin, but for that we need to register RLUSD as a security in the United States. That requires a completely different approach.

Stablecoins as fundamental components of the financial world

Over the next five years, I believe stablecoins will revolutionize traditional finance as they become more mainstream. I see Ripple’s recent acquisition of prime broker Hidden Road as a crucial step forward in enabling stablecoins to be used as collateral and cross-margin in capital markets.

I predict that stablecoins will become so ingrained in our financial system that one day no one will talk about them anymore—just like no one talks about SWIFT or bank transfers.

Frequently Asked Questions

What exactly are stablecoins?
Stablecoins are digital currencies designed to maintain a fixed value, often pegged to a fiat currency such as the US dollar.

Why are stablecoins important for the future of finance?
Because they make moving money simple and cost-effective, improving the efficiency of international payments.

What is the role of regulation in the development of stablecoins?
Regulation plays a crucial role, especially when it comes to offering yields on stablecoins. Current regulations vary by region, which can impact their adoption and use.

Share this article:

Disclaimer: The information on Block 9 is for general informational and educational purposes only. While we strive to provide up-to-date, correct and relevant content, we make no warranties as to the completeness, accuracy or reliability of the information provided. All content on this website, including articles, analyses, opinions and other publications, is for general information purposes only and does not constitute professional or legal advice in any way, including but not limited to financial, investment or tax advice.

Block 9 makes no guarantees or representations as to any possible results or returns that may arise from the use of information on this website. Nothing on this website should be interpreted as a recommendation to buy, sell or hold any particular asset, including but not limited to cryptocurrencies, tokens or other financial instruments.

The opinions and views expressed in contributions by editors, external authors or community members are strictly personal and do not necessarily represent the views or policies of Block 9 as a platform. Block 9 accepts no liability for any loss or damage – direct or indirect – resulting from the use of (or reliance on) the information published on this website.

Investing in cryptocurrencies and other digital assets involves significant risks. The value of such assets can fluctuate significantly, and there is a chance that you could lose (some of) your investment. We strongly recommend that you always do your own research (DYOR) and seek independent advice from a qualified financial advisor before making any financial decisions. By using this website, you agree to this disclaimer and accept that Block 9 is not responsible for your investment choices or the results thereof.