This week, the U.S. Senate and the Hong Kong Legislative Council almost concurrently took main steps in stablecoin regulation: the previous overwhelmingly handed a procedural movement on the GENIUS Act, clearing the best way for the primary federal stablecoin laws in america; the latter handed the third studying of the “Stablecoin Ordinance Invoice,” making Hong Kong the primary jurisdiction in Asia-Pacific to determine a stablecoin licensing regime. The synchronicity of Japanese and Western legislative progress is not any coincidence — it displays a broader contest for affect over the long run monetary order.
In accordance with preliminary statistics from OKG Analysis, the worldwide stablecoin market capitalization is approaching $250 billion, having grown greater than 22-fold over the previous 5 years. Because the starting of 2025, on-chain transaction quantity has surpassed $3.7 trillion and is projected to achieve almost $10 trillion for the 12 months. Stablecoins corresponding to USDT and USDC at the moment are broadly utilized in rising markets for buying and selling and remittances, with utilization volumes surpassing conventional cost techniques in some areas. What was as soon as thought-about a fringe asset has grow to be a core node in world cost networks and a device for sovereign competitors. The near-simultaneous legislative efforts within the U.S. and Hong Kong signify that the worldwide stablecoin market has entered a interval of accelerated regulatory alignment.
Primarily based on this, OKG Analysis — drawing on Normal Chartered’s earlier projection mannequin and factoring within the tempo of present regulatory alerts and institutional sentiment — has developed the next estimates underneath an optimistic state of affairs the place world regulatory frameworks are adopted and stablecoins achieve widespread use by people and establishments:
- International stablecoin provide may attain $3 trillion by round 2030.
- Month-to-month on-chain transaction quantity may attain $9 trillion.
- Annual transaction quantity might exceed $100 trillion.
This might place stablecoins not solely alongside conventional digital cost techniques however as foundational property in world clearing networks. By way of asset scale, stablecoins would grow to be the “fourth main base foreign money asset” after sovereign bonds, money, and financial institution deposits — serving as a key medium for digital funds and asset circulation.
Extra notably, the reserve construction of stablecoins underneath such growth may have macroeconomic implications. As OKG Analysis beforehand reported, present stablecoin holdings account for roughly 3% of maturing short-term U.S. Treasury payments — rating nineteenth amongst abroad holders.
Contemplating the GENIUS Act mandates that 100% of reserves be held in extremely liquid U.S. greenback property — with short-term Treasuries as a main element (over 80% of present USDT/USDC reserves are linked to short-term Treasuries) — a conservative 50% allocation of a $3 trillion market would create not less than $1.5 trillion in structural demand for short-term U.S. debt. This quantity is near the present holdings of sovereign buyers like China or Japan, suggesting stablecoins may quickly grow to be the U.S. Treasury’s largest “invisible creditor.”
Whereas the U.S. and Hong Kong differ in legislative paths and technical particulars, they share consensus on core ideas: fiat-pegging, full reserve backing, and licensed issuance.
The GENIUS Act applies to “cost stablecoins,” outlined as tokens pegged to authorized tender (e.g., USD), redeemable at 1:1 worth, and prohibited from providing curiosity — guaranteeing they aren’t handled as securities or funding automobiles. Hong Kong, whereas additionally requiring full backing, doesn’t prohibit curiosity funds or asset buildings within the present draft, leaving room for future improvements in a dollar-dominated stablecoin panorama.
Each jurisdictions mandate full reserve backing with high-liquidity property, although the GENIUS Act defines acceptable reserve property (T-bills, money, repos) and mandates month-to-month audits. Hong Kong equally requires audits and segregated custody however leaves asset sorts extra open.
By way of regulatory construction, the GENIUS Act adopts a federal-state twin framework, providing three issuance pathways: (1) by means of a licensed financial institution or its subsidiary (regulated by the Fed, FDIC, and so on.), (2) straight licensed by the OCC for non-bank entities, or (3) by means of certified state licensing regimes. Hong Kong’s Financial Authority (HKMA) handles all licensing and mandates that any issuer — whether or not primarily based in Hong Kong or overseas — should apply for a license if issuing HKD-pegged stablecoins or advertising providers to Hong Kong residents.
Relating to overseas issuers, the GENIUS Act prohibits unlicensed abroad stablecoins from circulating within the U.S., permitting the Treasury to designate “non-compliant stablecoins” and instructing digital asset service suppliers to dam their circulation. Hong Kong focuses totally on HKD-pegged stablecoins and stays extra open to foreign currency.
These structural variations replicate divergent coverage targets. The U.S. seeks to protect greenback hegemony and handle fiscal wants by extending greenback dominance onto the blockchain. In distinction, Hong Kong goals to draw world Web3 tasks whereas sustaining native monetary stability, crafting a “regulated sandbox” in Asia-Pacific that balances management with openness and interoperability.
The actual significance of stablecoin regulation lies in offering foundational infrastructure for large-scale Web3 adoption.
In DeFi, whereas USDT and USDC are already key settlement property, their unsure authorized standing has hindered institutional participation. The enactment of frameworks just like the GENIUS Act would enable compliant issuers to grow to be the settlement spine of “compliant DeFi,” incorporating KYC, AML, and asset recognition modules. Decentralized finance would evolve into “auditable on-chain monetary networks.”
In Web3 funds, regulation will take away grey zones between property and cost eventualities, reworking stablecoins from transaction intermediaries into cost channels. Since Visa introduced over $225 million in stablecoin settlements, many fintech corporations have built-in stablecoins into service provider flows. Web3 wallets use stablecoins as default property for microtransactions like top-ups, suggestions, and subscriptions. The transition from “crypto-native transfers” to “enterprise-grade monetary APIs” is determined by regulatory readability.
At a deeper stage, this reshapes world clearing structure. Stablecoins — pegged 1:1 to fiat currencies — bridge fiat and on-chain property whereas bypassing conventional banking rails, enabling peer-to-peer clearing. This might enable stablecoins to interchange conventional banks with cross-border funds, commerce finance, and RWA (real-world asset) payouts.
Traditionally, discussions on Web3 adoption targeted an excessive amount of on tech and UX, neglecting the legitimacy of core monetary property. Compliant stablecoins provide the lacking piece: legally acknowledged, programmable, fiat-linked digital property that can be utilized throughout DeFi and NFT ecosystems.
In essence, stablecoins should not auxiliary to Web3 — they’re a main catalyst. With regulatory help, they may underpin every part from RWA tokenization to payroll, cross-border settlements, and Web3 cost rails — turning into the foundational infrastructure for world on-chain economies.