Stablecoins: The Bridge Between TradFi and the Digital Asset Economy

The digital assets industry has spent more than a decade searching for the perfect balance between speed, accessibility and reliability. In that search, stablecoins have emerged as one of the most transformative use cases, combining the stability of traditional currency prices with the efficiency of blockchain.

Stablecoins are digital tokens pegged to stable assets like the US dollar or euro, making them uniquely positioned to serve as both a reliable store of value and a frictionless medium of exchange in the global economy. For traditional institutions, this means access to the wider digital asset space – and the additional use cases, revenue streams, customers and efficiencies that this new era of finance has to offer.

The momentum is hard to ignore: Stablecoins so far have powered more than two-thirds of all crypto trading volume in 2025, with $6.6 trillion in transactions over the last 12 months alone. Deutsche Bank Research puts the 2024 figure even higher, with $27.6 trillion processed in a single year. The total market capitalization now exceeds $289 billion as of August 2025, more than doubling since December 2024.

And interest is still growing, with central banks, regulators and even major payment businesses across the fintech and traditional finance space exploring stablecoin rails. From Ripple’s 2025 New Value Stablecoin Report, 33% of global finance leaders already use stablecoins in business operations, and 86% are open to doing so within the next three years.

Why stablecoins are different

The appeal of stablecoins lies in their ability to merge the reliability of traditional currencies with the operational benefits and burgeoning use cases afforded through blockchain technology.

Take global payments, for example: In the traditional banking system, sending funds internationally often involves multiple intermediaries, foreign exchange markups and settlement delays that can stretch to several days, especially across time zones or during weekends. Stablecoins eliminate much of this friction.

By operating on decentralized blockchain networks, stablecoins:

• Settle payments in real time, regardless of bank operating hours
• Reduce intermediary fees and costs from FX spreads
• Improve reliability by cutting down on failed transactions
• Offer traceability, with every transaction being verifiable on-chain for transparency and compliance
• Increase accessibility, since individuals only need an internet connection and a digital wallet to participate

This combination of stability, speed and global reach is why payments, particularly of the cross-border variety, are emerging as the stablecoin sector’s breakout use case.

Bridging traditional finance and crypto

Stablecoins act as a true bridge between traditional finance (TradFi) and the crypto ecosystem. They function as both an on-ramp for individuals and institutions entering digital markets, and an off-ramp for converting digital assets back into fiat currency.

This bridge is valuable for both sides, too. For TradFi players, stablecoins provide access to blockchain settlement without exposure to crypto volatility. For crypto-native companies on the other hand, they offer a familiar, stable unit of account that can integrate seamlessly into traditional financial workflows.

In practical terms, with the right payment solution, businesses and institutions can accept stablecoin payments from anywhere in the world, instantly convert them to fiat if needed and avoid the headaches of currency swings or delayed settlements. On the other side, a bank exploring tokenized deposits can interact with blockchain ecosystems via stablecoins while staying anchored to their compliance framework.

RLUSD$1.0007: Compliance at the core

Initially, stablecoin adoption was dominated by retail traders and crypto-native platforms. RLUSD takes a different path by being purpose-built for enterprises and financial institutions from its inception. Its design prioritizes regulatory compliance, institutional-grade security and operational efficiency, making it a natural fit for payment flows that demand both speed and oversight. RLUSD is also integrated into Ripple’s licensed cross-border payments solution, Ripple Payments, underscoring the company’s focus on bringing credibility and trust to blockchain in finance.

Key features of RLUSD include:

• Compliance-focused structure, issued under a New York Limited Purpose Trust Company Charter
• Fully backed by short-term reserves, minimizing risk to holders
• Custodied by BNY, one of the world’s largest and most trusted asset custodians
• Seamless cross-border settlement integrated directly into Ripple Payments, allowing customers to leverage stablecoin benefits without holding them on balance sheets
• Interoperability by facilitating smooth on- and off-ramping between stablecoins, fiat and other digital assets

The recent announcement that Ripple is acquiring Rail, a stablecoin-powered global payments platform, further strengthens Ripple’s capabilities. Rail’s virtual account infrastructure and automated back-office systems streamline operations for enterprises, making it easier than ever to integrate stablecoin settlements into existing payment flows.

Leveraging the XRPL for institutional use cases

RLUSD is native to the XRP Ledger (XRPL), a blockchain known for its speed, scalability and low transaction costs. The XRPL’s built-in decentralized exchange (DEX) and auto-bridging features enable efficient asset trading and settlement without complex smart contracts. This architecture is particularly well-suited for institutional DeFi, lending markets, tokenized real-world asset transactions and of course, large-scale cross-border settlements. Other fiat-backed stablecoins available on the XRP Ledger include: USDC, XSGD, EURØP and USDB.

By combining the XRPL’s technical advantages with RLUSD’s compliance and trust framework, Ripple offers a purpose-built solution for global payments. One that could serve as a blueprint for institutional adoption of stablecoins.

Payments: Stablecoins’ most promising frontier

While stablecoins have become an indispensable trading tool in crypto markets, their largest growth potential lies in payments. Particularly B2B transactions, cross-border settlements, corporate treasury and remittances.

B2B & cross-border payments

Businesses moving funds across borders often face high costs, FX conversion issues and inconsistent settlement times. Stablecoins allow for 24/7 global transfers, reducing costs, unlocking liquidity for working capital and improving cash management. This is particularly beneficial for companies operating in multiple regions or paying suppliers in emerging markets.

Corporate treasury

For large organizations, stablecoins can reduce the need to trap capital in foreign bank accounts and make global cash management more efficient. Paying suppliers in their local currency, via a stablecoin settlement layer, can also improve relationships and strengthen commercial terms.

Remittances

Migrants sending money home have long been at the mercy of high remittance fees. Stablecoins can cut those costs while also delivering faster settlement and fewer errors. For recipients in countries with limited banking infrastructure, stablecoins received via mobile wallet can be a lifeline, especially when paired with off-ramps into local fiat.

On- and off-ramps for crypto

For exchanges and other platforms, stablecoins provide a universal bridge between fiat and digital assets. This enables more consistent pricing, reduces volatility in trading pairs and improves overall market efficiency.

The next phase of digital payments

Stablecoins have already proven their value in crypto markets, but their broader role in global finance is just beginning to unfold. With over $246 billion in market capitalization and trillions in annual transaction volume, they are no longer a niche experiment. They are becoming a core part of the digital economy’s infrastructure.

Payments, especially those that are cross-border in nature, represent the sector’s most compelling growth area, offering benefits that traditional systems struggle to match: faster settlement, lower costs, enhanced transparency and greater accessibility.

RLUSD is one example of how stablecoins are evolving to meet enterprise needs, combining the compliance and trust frameworks of traditional finance with the speed and efficiency of blockchain.

For fintechs and crypto natives, the takeaway is hard to miss: The next era of payments isn’t on the horizon. It’s already in motion. Stablecoins have moved far beyond speculation to become a core financial tool, a bridge to global liquidity and a launchpad for new business models. The real question isn’t whether they’ll transform payments, but how quickly your organization will be ready to move with them.

To learn more about the rise of stablecoins and their impact on payments, download Ripple’s 2025 New Value Stablecoin Report.