Why Asia Could Define the Next Chapter of Stablecoins

For years, stablecoins were primarily viewed as tools for cryptocurrency trading. Today, that perception is changing.

Across Asia, stablecoins are increasingly being discussed as part of financial infrastructure—not simply as digital assets, but as technology that can improve payments, cross-border settlement, treasury operations, and eventually tokenized capital markets.

The conversation is no longer centered on whether stablecoins have value. Instead, policymakers, financial institutions, and infrastructure providers are asking a different question:

How can stablecoins be integrated into existing financial systems in ways that deliver measurable economic benefits?

Stablecoins Are Moving Beyond Crypto

The evolution of stablecoins has accelerated over the past several years.

According to Chengyi Ong, Director of APAC Policy & Regulatory Strategy of Circle, USDC now has more than US$75 billion in circulation and processed approximately US$21.5 trillion in on-chain transaction volume in a single quarter. While supply continues to grow, transaction velocity increasingly reflects how stablecoins are being used within both digital asset markets and broader financial activities.

More importantly, real-world applications are expanding.

Across Asia, payment providers are using stablecoins to reduce cross-border settlement times, optimize liquidity, and minimize the need for pre-funded accounts. Globally, they are also supporting creator payouts and humanitarian aid distribution.

As Chengyi Ong, Director of APAC Policy & Regulatory Strategy at Circle, observed:

"The discussion around stablecoins has shifted from future possibilities to present-day use cases."

Stablecoins are increasingly being evaluated as financial infrastructure rather than speculative assets.

Why ASEAN Is Well Positioned

ASEAN possesses several characteristics that naturally support stablecoin adoption.

• Cross-Border Economies Need Better Settlement
  Southeast Asia is deeply connected through regional trade and supply chains, yet cross-border payments remain fragmented and costly. For export-oriented economies, faster settlement and more efficient liquidity movement have clear economic value. Stablecoins provide an internet-native payment rail capable of operating continuously rather than only during banking hours.

• Remittance Markets Create Immediate Demand
  Several ASEAN economies depend heavily on cross-border remittances. Lower transaction costs and faster transfers can directly improve financial outcomes for households while expanding access to more efficient payment infrastructure. Rather than creating entirely new demand, stablecoins address an existing economic problem.

• Digital-First Consumers Lower Adoption Barriers
  The region has already embraced digital payments through QR codes, mobile banking, and e-wallets. Combined with high smartphone adoption and strong internet connectivity, this creates an environment where blockchain-based financial services can integrate into existing user behavior rather than requiring entirely new habits. These structural characteristics position ASEAN as a natural environment for payment innovation.

Regulation Is Becoming a Competitive Advantage

One of the strongest themes emerging across Asia is that regulation is increasingly enabling innovation rather than slowing it.

Instead of rushing directly toward comprehensive legislation, many jurisdictions are using regulatory sandboxes to understand real-world applications before determining long-term policy. Examples include:

Source: SCB 10X analysis based on Global Stablecoins, Local Markets: The Politics of Market Entry in Asia, REDeFiNE TOMORROW 2026.

Rather than adopting identical approaches, regulators are tailoring policy to domestic economic priorities while evaluating practical use cases.

As Chengyi Ong explained, this reflects a distinctly pragmatic philosophy:

Innovation should solve measurable economic problems—not simply introduce new technology.

That emphasis on real economic value may become one of Asia's defining advantages.

Local Currency Stablecoins Could Expand Tokenized Markets

Today, more than 90% of stablecoins are denominated in U.S. dollars. Yet that market structure is unlikely to represent the final stage of development.

As regulatory certainty improves across Asia, local currency stablecoins could begin supporting a wider range of financial activities. Potential applications include:

• Tokenized government bonds
• Corporate debt
• Equity settlement
• Foreign exchange
• Programmable securities

Their role extends beyond payments.

Local currency stablecoins can serve as settlement assets for tokenized financial markets, helping improve efficiency while supporting the long-term development of domestic capital markets.

The Real Challenge Is Interoperability

Technology is no longer the primary obstacle. Stablecoins generate the greatest value when they move seamlessly across institutions and jurisdictions. Fragmented regulatory frameworks risk limiting that potential.

Key challenges include:

• Different licensing requirements
• Compliance standards
• Capital controls
• AML/KYC expectations
• Cross-border regulatory recognition

As Chengyi Ong noted, stablecoins are global tools. Their effectiveness depends on the ability to operate across jurisdictions rather than within isolated regulatory silos. The next phase of adoption will therefore depend as much on institutional coordination as technological progress.

AI May Become the Next Driver of Stablecoin Demand

Artificial intelligence introduces an entirely new payment paradigm.

As AI agents increasingly perform economic activities autonomously, they require payment infrastructure that is:

• Always available
• Programmable
• Low cost
• Machine-readable
• Capable of supporting micropayments

Stablecoins naturally satisfy many of these requirements. Future AI systems may purchase APIs, manage cloud spending, execute treasury functions, or interact with digital services without direct human involvement. Rather than replacing traditional finance, programmable digital money expands the range of participants capable of engaging in economic activity.

Success Should Be Measured by Outcomes

Perhaps the most important lesson emerging across Asia is that adoption alone is not the ultimate objective.

The more meaningful indicators are economic outcomes:

• Lower remittance costs
• Faster settlement
• More efficient capital markets
• Better liquidity management
• Greater financial inclusion
• Improved cross-border financial connectivity

Technology becomes infrastructure only when its benefits become measurable within the broader economy.

SCB 10X Perspective

Asia is shaping a distinctive path for stablecoin adoption. Rather than pursuing innovation for its own sake, regulators and market participants are focusing on practical applications that improve the efficiency of existing financial systems. The next chapter of digital money is therefore unlikely to be defined by technology alone.

It will be shaped by regulatory clarity, institutional collaboration, and the ability to solve real economic problems. If that trajectory continues, stablecoins may become one of the foundational layers of next-generation financial infrastructure—not by replacing today's financial system, but by making it work more efficiently.

Watch the full discussion and explore more insights here: https://youtu.be/Yga_JqS7te4?si=aIdfbClLnCsVF7XG 

What Are Stablecoins?

Stablecoins are crypto assets designed to maintain a stable value by being pegged to a reference asset, most commonly a fiat currency such as the U.S. dollar. Unlike cryptocurrencies such as Bitcoin or Ether, whose prices fluctuate significantly, stablecoins are designed to function as digital money for payments, settlement, and value transfer on blockchain networks.¹

Stablecoins vs. Cryptocurrencies

While stablecoins are a type of crypto asset, their role differs from that of traditional cryptocurrencies. Bitcoin and Ether primarily serve as investment assets with market-driven prices, whereas stablecoins prioritize price stability, making them increasingly suitable for payments, liquidity management, and financial infrastructure.²

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Source:

¹ International Monetary Fund (IMF). Understanding Stablecoins. 2025. ² Bank for International Settlements (BIS). Annual Economic Report 2025. 

The analysis in this report is based on the REDeFiNE TOMORROW 2026 session Global Stablecoins, Local Markets: The Politics of Market Entry in Asia, featuring Chengyi Ong, Director of APAC Policy & Regulatory Strategy, Circle.