The Real Reason People Are Using Stablecoins

May 29, 2025

2025 is the year of stablecoins. 

Transaction volumes have grown to over $33 trillion in the past 12 months. The top Dollar-denominated stablecoins are the 17th largest holder of US treasuries globally. Tether, issuer the largest stablecoin by volume, USDT, announced $13 billion in net profit in 2024. Circle, the USDC issuer, is going public.

But what got the hype train going was Stripe’s acquisition of the startup Bridge for $1.1 billion.

And all of Bridge’s product market fit is coming from emerging markets and outside the US. 

But why? 

This is the first episode in The Flip’s new human-first series on stablecoin adoption from the rest of the world. Stablecoins are solving everyday problems for people in markets where there’s import deficits, currency devaluation, insufficient banking infrastructure, and more. 

This series will bring to life these conditions and humanize the onchain data.

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Transcript

Off Camera: Do people in the US ask you why you need stablecoins? 

Zach Abrams: All the time. 

Justin Norman: Millions of people around the world are using stablecoins. But it’s not why you might think. It’s not who you might think. And it’s not where you might think. 

Stablecoins have seen an explosion of growth. 

Justin Norman: You’ve probably seen the technological explanation of stablecoins. But that only tells part of the story. What I want to know is who’s using stablecoins? And why? 

And what it is about their day to day realities in the places they live that leads to scablecoin adoption?

Zach Abrams: We believe that stablecoins will ultimately become this core financial infrastructure on top of a lot of the world’s financial services get rebuilt.

Justin Norman: That’s Zach Abrams, the Co-founder and CEO of Bridge. 

Zach Abrams: Bridge builds APIs that enable you to create anything you want with stablecoins.

Justin Norman: Its software lets companies seamlessly move money and make payments using stablecoins. The company exploded onto the scene when Stripe acquired it for $1.1 billion, despite being just 18 months old.

Remember when Google bought YouTube? Or when Facebook snapped up Instagram? Their growth exploded and both startups had a profound impact on their new parent companies. And if stablecoins are truly the next big thing, then this is the guy we need to talk to first. 

Zach Abrams: When the Stripe acquisition was announced, we very viscerally felt Bridge and stablecoins shift where we were along the adoption curve. Before Stripe, there was a lot of entrepreneurs all around the world who wanted to build on top of stablecoins. After the acquisition, there were all these global businesses that started coming because they wanted to build something with stablecoins.

Justin Norman: Stablecoins are digital currencies with a value tied to an underlying asset. The most popular stablecoins are dollar-backed stablecoins like USDC or USDT which are secured by US treasuries, so 1 USDC or USDT equals $1. 

But these currencies are built on the blockchain, so they get all of the technological benefits of cryptocurrencies without the volatility. They’re cheaper and faster to settle than fiat currencies, and stablecoins are default global, which means anyone in the world can access them, bypassing banking infrastructure limitations, especially in underbanked regions.

Stablecoin transaction volumes have doubled over the past 12 months, where total volumes have grown to over $33 trillion. And combined, the top Dollar-denominated stablecoins are the 17th largest holder of US treasuries globally.

Stablecoins have become increasingly popular for non-crypto use cases, and these real world use cases driving much of this volume come outside the US.

Zach Abrams:  We started the company in the US. All of our experience has been building financial services in the US. But today, almost the entirety of our product market fit is outside the US. 

 It sounds weird now, but we really had no idea about literally any of the use cases that we're supporting today.  It was very much a, if you build it, they will come type of hypothesis. We deeply believed in this thesis that if you could move money faster, cheaper, if you could enable people to build fintechs much more quickly, that folks would come and be rational about the building blocks that they used. But we were not sure what use cases were going to be. 

We launched our APIs two years ago and more or less every two, three months, some new use case has emerged that is seemingly bigger than all of those before it. The first use case that we saw was cross border payments. The second use case we saw was global payouts. So Scale AI or the US Government dispersing payments to people in a lot of different countries. Then we saw a lot of what we call dollar access customers, so a neobank building for the Latin American market or the African market, building on top of stablecoins. Then we saw treasury management. This was SpaceX selling Starlink all over the world and repatriating those funds to the US via stablecoins.And we just launched a global card product, which will enable a whole new class of fintechs to globally issue cards for consumers and businesses. 

And we fully expect that, in the next three months, some other use case will come along that dwarfs all these. 

Justin Norman: While a stablecoin can be a virtual representation of any asset, the reason why dollar-backed stablecoins are the most popular is because of what the dollar is used for in the global economy. And what you may not realize, is just how much the dollar is in demand from the rest of the world.

Approximately two-thirds of all US Dollars - $1.58 trillion - circulate outside the United States. But besides holding dollars for savings and investment, much of the demand is for the utility of the dollar.

The US Dollar is 59 percent of reserve currencies. 64 percent of world debt is denominated in dollars. 54 percent of foreign trade invoices globally are in dollars. And even if you’re invoiced in a different currency, you probably still need to go through dollars, as 88 percent of all foreign exchange transactions globally involve the US dollar. And demand will continue to grow from emerging markets, in particular, where the share in global trade has tripled in the last 35 years.

But dollars can be hard to come by in emerging markets, where there are import deficits and currency devaluation. So the early adopters are turning to stablecoins.

In Lagos Nigeria’s Computer Village, these cell phone parts are all imported from China. They pay their suppliers using stablecoins.

Barbara Iyiyi: When you think about Africa, for example, you have 44 million SMEs. 61 percent of them are doing cross-border trade, because a lot of these countries are constantly importing goods. I think what people don't sometimes realize is that even an informal trader needs to buy something from China or from another country. And because of that, they all need dollars. 

And these informal traders are more likely to use stablecoins because they want to leapfrog. They want to get services they can't get from a bank. And so there's a huge opportunity to use stablecoins.

Justin Norman: In Manila, Philippines, this Virtual Assistant is working the night shift for a US-based company. She’s paid in Dollars, using stablecoins.

In Mexico City, these people receive money sent instantly from their relatives, and convert into local currency for spending.

And in Sao Paolo, in Buenos Aires, in Nairobi, in Jakarta, and all around emerging markets, where these same problems exist for everyday people. 

Justin Norman: In 2021, Stripe launched payment links, a use case that took off in emerging markets. At the time of its launch, Stripe’s Co-founder & CEO Patrick Collison wrote, 

I suspect that staying abreast of important new patterns emerging outside US/Europe will become more important for many businesses in the years ahead... there are a lot of legacy assumptions being questioned.

This is the story of stablecoin adoption. People in emerging markets are using stablecoins for real use cases, where the global banking system doesn’t work for the majority of the population’s everyday needs. 

It’s not just that stablecoins are faster or cheaper, but that their accessibility and technological properties could enable new use cases not yet imagined. And that is why, if we want stablecoins to reach their full potential, we need to understand why they’re being used in the rest of the world. 

Zach Abrams: I think people in the US think the whole world is the US, you know? And so, if a US fintech doesn't need stablecoins to serve a US consumer, then what's the point? But, there's billions of people outside the US, the majority of which are significantly more underserved than the people in the US. The US market is really big. And so most companies can become very successful just serving that market. But the rest of the world is a whole lot bigger.

Justin Norman: This episode is the first of The Flip’s new series on stablecoin adoption. In this series, we’re going to journey through emerging markets to tell the human stories behind the onchain data, bringing to life the conditions at the last mile that are driving stablecoin adoption. Hit that subscribe button and join us as we explore how money moves.