Stablecoins: The New Banks of the Future

Stablecoins, originally designed to provide a reliable, consumer-focused alternative payment structure, are in danger of becoming centralized instruments within traditional banking structures. Increasing regulation in both the United States and Europe raises concerns about this development.

In the United States, the GENIUS Act established a framework for the issuance, certification, and regulation of stablecoins. In Europe, the MiCA (Markets in Crypto-Assets) regulation, which took effect in 2024, established strict requirements for stablecoins, categorized as "e-money tokens" and "asset-referenced tokens."

While these regulations promote legitimacy and security, they force stablecoin issuers to adapt to a bank-like model. The need to comply with requirements related to reserves, audits, know-your-customer (KYC), and buybacks is shifting the intrinsic value and functionality of stablecoins. As a result, they are increasingly becoming centralized gateways, rather than fulfilling the promise of peer-to-peer payments. Over 60% of stablecoin usage by businesses is focused on cross-border settlements, rather than consumer payments. This indicates that stablecoins are being used more as institutional tools than as payment tokens for individuals.

The Risk: Evolution to the Next SWIFT

What does it mean to “become the next SWIFT”? It means that stablecoins are becoming the standard rails for institutions; efficient, yet opaque, centralized, yet indispensable. SWIFT networks have transformed the global banking industry by enabling messaging between couches enable, but haven't created broader access to banking services. If stablecoins follow this trend, their role will be limited to providing faster rails for existing players, rather than empowering the underbanked.

The promise of cryptocurrency was programmatic money—cash that can be traded with logic, autonomy, and user control. However, when transactions require issuer approval, compliance tagging, and verified addresses, the architecture changes. The network transitions from a free system to a conformity structure, undermining the fundamental radical nature of stablecoins.

The challenge lies not with the regulation itself, but with its design. To safeguard the promise of stablecoins within the framework of regulatory requirements, developers and policymakers must build compliance into the protocol level, ensure connectivity across jurisdictions, and maintain non-custodial access. In practice, initiatives like the Blockchain Payments Consortium offer a glimmer of hope that standardization of cross-chain payments is possible without compromising openness.

Stablecoins should primarily function for individuals, not just institutions. If they only serve large players and regulated flows, there will be no disruption—they will simply adapt. The design must support true peer-to-peer movements, selective privacy and enable interoperability. Otherwise, we risk becoming stuck in old hierarchies, albeit at a faster pace.

The potential of stablecoins to rewrite our understanding of money remains. But if we allow them to degenerate into institutional rails built for banks instead of people, we are simply replacing one central system with another. The key question isn't whether we regulate—stablecoins will be regulated. The question is whether we design for inclusion and autonomy, or whether we partially hide yesterday's systems behind digital shells. The future of money depends on which path we choose.

Frequently Asked Questions

Why are stablecoins subject to stricter regulation?
Stricter regulation is intended to ensure the security and legitimacy of stablecoins, but could also undermine their role as alternative means of payment.

What is the risk of central control over stablecoins?
Centralized control could undermine the innovation and potential of stablecoins to serve the unbanked, turning them into tools for large institutions only.

How can the future of stablecoins be made more inclusive?
By incorporating compliance into the design of stablecoins, a balance can be struck between regulation and the original promise of peer-to-peer payments, so that individual users also benefit.