Stablecoins Emerge as the Internet’s Default Settlement Layer

Stablecoins have revolutionized on-chain finance, now surpassing traditional card networks like Visa and Mastercard in transaction volume, according to Alchemy’s head of engineering, Noam Hurwitz. By tackling global payment friction with near-instant, low-cost transfers, stablecoins are increasingly embedded in the online financial infrastructure.

Fintech giants including PayPal, Stripe, Visa, and Circle are actively integrating stablecoins into their platforms, leveraging blockchain rails for faster, more efficient global payments. Hurwitz highlights their appeal: they offer money that is “cheap, fast, global and secure to transfer.” Use cases have expanded well beyond trading—covering cross-border remittances, decentralized prediction markets, and corporate cash management.

Meanwhile, stablecoins have become major holders of U.S. Treasurys. Tether’s USDT, for example, reportedly holds more than $113 billion in U.S. government debt, generating approximately $13 billion in profits from interest income last year. This underscores stablecoins’ role not just in transactions, but as institutional-grade financial instruments.

Despite this rapid expansion, challenges remain. Blockchain fragmentation makes integration and coordination complex, and institutions must carefully assess provider reliability. Infrastructure providers like Alchemy are building cross-chain support, layer-2 networks, and permissioned token systems—including JP Morgan’s “Kinexys”—to deliver enterprise-grade performance and 24/7 settlement.

Regulatory clarity is also progressing: the U.S. Senate recently passed the GENIUS Act, a federal framework aimed at standardizing stablecoin issuance and oversight. While this supports innovation by mainstream players, the Bank for International Settlements (BIS) urges caution, noting that stablecoins still lack key monetary properties such as elastic supply and central bank backing.

Looking ahead, Hurwitz expects financial services firms to deploy their own chains and tokens, fostering seamless interoperability across networks. If stablecoins continue maturing, they could form the backbone of an interconnected, tokenized financial ecosystem—so long as interoperability, regulatory oversight, and technical reliability are effectively addressed.