Can Stablecoins Spark Crypto Adoption Across Retail and B2B Markets?

The cryptocurrency sector has long been in search of gateway use cases to accelerate adoption.

News broke Friday (Aug. 23) that Wyoming is reportedly developing its own U.S. dollar-backed stablecoin to be used for consumer payments. The Wyoming Stable Token could be launched as soon as in the first quarter of 2025. Now, observers are wondering whether stablecoins might serve as the best onramp for users to enter the digital asset space.

A few days earlier, on Wednesday (Aug. 21), Latin American eCommerce giant Mercado Libre launched a new U.S. dollar-pegged stablecoin in Brazil through its financial arm, Mercado Pago.

The stablecoin, called Meli Dollar, can be purchased and sold through the Mercado Pago app without incurring any transaction fees during the initial phase with the fee-free structure geared toward not only reducing the impact of the Brazilian Real’s currency fluctuations but also increasing the scalability of the asset.

Mercado Libre has been trying to integrate cryptocurrency solutions into its ecosystem for years, previously introducing Mercado Coin, a cryptocurrency used for purchases and cash back, on its platform in 2022 as part of its loyalty program, as well as integrating bitcoin, Ether and the Pax Dollar (USDP) stablecoin for payments.

Stablecoins, like the Meli Dollar or Wyoming Stable Token, can be integrated into existing digital wallets, making them easy to use for those already familiar with mobile payments. As more merchants begin to potentially accept stablecoins as a form of payment, users will have more opportunities to engage with digital assets in a way that feels familiar and secure. This could lead to a gradual increase in cryptocurrency adoption among end-users, including businesses that might otherwise have been hesitant to enter the market.

Read also: What CFOs Should Know About the Growing Use of Stablecoins

Bridging Gap Between Traditional Finance and Digital Assets in B2B

While Latin America rushes to innovate with crypto, the European Union’s landmark Markets in Crypto-Assets Act (MiCA) is forging ahead with regulating the stablecoin landscape.

It is in the B2B sector in particular where stablecoins — and their regulated use and policy frameworks — hold particular promise as a tool for streamlining cross-border transactions.

“It’s important to know that crypto is not just bitcoin and Doge and NFTs,” Sheraz Shere, head of payments at Solana Foundation, told PYMNTS in May. “… Blockchains are really alternative rails for payments and financial assets.”

“An issue has been that the technology has not been user-friendly,” Shere added. “It’s all been designed by engineers … to be very tech-centric and not use case or UX centric.”

Traditional methods of international payment, such as wire transfers, can be slow, expensive and subject to various regulatory hurdles. Stablecoins, however, offer a more efficient alternative. Transactions can be completed almost instantaneously, with lower fees and fewer intermediaries.

Because stablecoins are pegged to a stable asset, businesses can use them to conduct transactions without worrying about currency fluctuations that could affect the final amount received or paid.

“People are rewiring their businesses around payments,” Thredd CEO Jim McCarthy explained to PYMNTS in April. “The winners in the future truly will understand that payments [are] at the middle of everything they do.”

See also: Instant Payments Versus Stablecoins: The Race to Rule Real-Time Transactions

For example, a company in the United States could use a dollar-pegged stablecoin to pay a supplier in Europe. The transaction would be completed in minutes rather than days, with lower fees and no risk of currency exchange rate fluctuations. This not only improves cash flow management but also allows companies to operate more efficiently in a global marketplace.

The only requirement is for the stablecoin to adhere to the regulations of each country. That’s why the European Central Bank (ECB) is conducting exploratory work on new technologies for wholesale central bank money settlement (ntwCeBM).

“To fully leverage the potential of the evolving payments landscape and ongoing initiatives, the ECB is planning a special focus workshop on innovations in B2B payments and the role central bank money could play,” the ECB said in a statement. “The potential of private undertakings such as eMoney tokens (stablecoins), commercial bank money tokens (CBMT) and other, similar forms will also be discussed.”

A dedicated market contact group, the New Technologies for Wholesale settlement Contact Group (NTW-CG) has been established, the ECB said.

Still, on the consumer and retail side of things, the ECB’s digital euro stablecoin is facing pushback from Germany, whose citizens harbor growing concerns about privacy and the security of their money.

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