Crypto Bulls Rejoice as Stablecoins Move from Speculation to Necessity

For much of its history, crypto has been defined more by volatility than utility. Prices moved on narratives about decentralization or scarcity, but everyday economic use remained limited. Stablecoins such as Tether (USDT-USD) and Circle (USDC-USD) are now altering that dynamic. Instead of serving mainly as trading tools, they are increasingly used for payments, settlement, and treasury management, shifting attention toward crypto as financial infrastructure.

Stablecoins are digital tokens designed to track fiat currencies, most often the U.S. dollar. Their early role was to provide a parking place for capital inside crypto markets. Today, that function is expanding beyond exchanges.

Data from Chainalysis and Visa shows that stablecoins account for the majority of on-chain transaction volume, exceeding the combined volume of Bitcoin (BTC-USD) and Ether (ETH-USD) transfers in several recent quarters. This suggests that stablecoins are becoming the dominant medium of exchange within blockchain systems, even if they are not the main store of value.

Adoption Expands Beyond Speculative Trading

Early stablecoin growth was driven mostly by crypto traders hedging volatility without returning to the banking system. Over the last two years, however, usage has broadened into cross-border payments, corporate treasury operations, and merchant settlement.

This transition reflects a clearer separation between crypto as an investment asset and crypto as a transaction rail. According to Rocio Rodriguez, Crypto Vertical Lead at dLocal, stablecoins are increasingly being used not for price exposure but for utility, such as payments, settlement, and treasury management. That positions them closer to financial infrastructure than to speculative assets.

Two metrics support this trend. The total market capitalization of stablecoins has grown from under $30 billion in 2020 to more than $130 billion in recent years. Just as important is how they are used: in many emerging markets, a growing share of on-chain activity now involves stablecoins, as households and businesses use them to navigate currency volatility and move value across borders.

In cross-border payments, speed and predictability are central advantages. Traditional correspondent banking systems can take days to settle transactions. Stablecoins can transfer value in minutes continuously. For firms managing international supplier payments or payroll, that difference translates into working capital efficiency rather than a trading opportunity.

Market Structure Shifts Towards Stability

As stablecoins take on a greater settlement role, they are reshaping the crypto market structure. Transaction flows are becoming more concentrated around a few dominant stablecoins and the blockchains that support them. Networks that offer low fees and high reliability are attracting a growing share of stablecoin transfers.

This concentration is also changing the competition among blockchains. Instead of being judged mainly on decentralized finance experimentation, networks may increasingly be evaluated on their ability to handle predictable, high-volume settlement activity, closer to the role of card networks or interbank clearing systems in traditional finance.

Stablecoin issuers also occupy a more central position. Their credibility depends on reserve transparency, governance, and redemption mechanisms. Unlike speculative tokens, their success is tied to trust and operational soundness, which favors issuers that achieve regulatory clarity and institutional partnerships.

Payment and infrastructure platforms form another layer of value creation. These firms turn on-chain transfers into usable tools by handling compliance, currency conversion, and integration with local payment rails. As stablecoin usage grows, platforms that bridge blockchain and real-world payments are positioned to capture a share of transaction flows.

Valuation Implications for Crypto Investors

The infrastructure role of stablecoins changes how parts of the crypto market can be valued. If crypto remains primarily a speculative asset class, valuation depends largely on risk appetite and narratives. If parts of the ecosystem function as settlement rails, valuation can be linked to economic throughput and fees.

Blockchains that host stablecoin flows can be evaluated based on transaction volume, fee levels, and network usage. Stablecoin issuers, meanwhile, resemble narrow financial institutions whose revenue is tied to reserve management and payment services.

Furthermore, payment companies that integrate stablecoins may benefit from both fintech and crypto adoption trends. By lowering settlement costs and improving cross-border speed, they can compete with traditional remittance and treasury systems. For investors, these firms offer exposure to blockchain adoption without relying entirely on token appreciation.

Who Benefits Most from Crypto Settlement

Four groups appear best positioned to benefit from the shift toward settlement. The first group is large stablecoin issuers with strong reserve practices and regulatory engagement. The second is blockchains optimized for low-cost, reliable settlement and capable of supporting high transaction volumes for stablecoin transfers.

The third group is infrastructure platforms that connect stablecoins to real-world finance. Their role in compliance and conversion makes them essential to mainstream adoption. Speculative tokens that rely primarily on trading activity may benefit less directly, as their value remains tied to market cycles rather than transaction demand.

One last beneficiary is stock investors. As crypto spreads worldwide and becomes more stable and trusted, several U.S. stocks are already listed and are attempting to be the first through the crypto door. TipRanks readers can see which stocks are most closely related to the cryptosphere, along with the most accurate analyst for each.

Crypto Risks Linger On

Despite rising adoption, stablecoins face constraints. Regulatory treatment varies widely by jurisdiction, creating uncertainty for firms operating across borders. Trust in issuers remains critical, particularly around reserve management and redemption rights. Dependence on banks for fiat conversion can also become a bottleneck.

There is also a concentration risk. Most stablecoins are linked to the U.S. dollar, exposing users to U.S. monetary policy and regulatory decisions. While this can provide stability relative to local currencies, it also limits diversification.

Investment Narrative Changes On the Fly

Stablecoins are not eliminating speculation from crypto markets, but they are adding an infrastructure layer that did not previously exist at scale. Payments and settlement now sit alongside trading as core functions of blockchain systems. For investors, this alters the investment case: crypto is no longer only about volatility and price cycles, but also about whether blockchain-based systems can compete with traditional financial rails.

If stablecoins continue to grow as transaction tools, the crypto ecosystem may increasingly resemble a utility network rather than a purely speculative arena. That shift does not remove risk, but it anchors part of the market to measurable economic activity and reframes how long-term value in crypto is assessed.