"Societies operate on standards of average performance. They sustain themselves by practicing the familiar. But they progress through leaders with a vision of the necessary and the courage to undertake a course of action whose benefits at first reside largely in their vision."
– Henry Kissinger
This powerful quote, drawn from Henry Kissinger’s reflections on China, resonates deeply in today’s fast-evolving financial landscape. It captures a fundamental truth: progress doesn’t come from incremental tweaks, but from bold leaps—driven by visionaries willing to challenge inertia. In technology and finance, these leaps are rare. Artificial Intelligence (AI) is one such leap. Its impact is universal, tangible, and already embedded in our daily lives—from writing emails to analyzing data.
But what about stablecoins? Are they another transformative breakthrough like AI—or are they, as some skeptics argue, a solution in search of a problem?
This question was recently posed by Jack Zhang, CEO of Airwallex, in a widely discussed tweetstorm questioning the real-world utility of crypto and stablecoins—especially in the Global North. He asked:
“Crypto is an area I had never been able to understand. I still don’t see a single use case yet on how crypto is helping anything in the last 15 years.”
His skepticism extends to stablecoins: even if they’re less volatile, he argues, their role in B2B transactions remains unclear—unless tied to exotic currencies with limited liquidity. Unlike AI, where value is self-evident, stablecoins lack widespread adoption and clear utility for most consumers.
Yet, responses flooded in offering counterpoints:
- Regulatory clarity could boost institutional adoption.
- Stripe’s acquisition of Bridge may accelerate merchant integration.
- Giants like Amazon and Walmart are exploring branded stablecoins.
- Circle’s IPO signals growing institutional confidence.
- Treasury management and cross-border payments are emerging as key use cases.
- Agentic AI could drive programmable money demand.
Wole Ayodele, CEO of Fincra, echoed Zhang’s sentiment:
“You’re spot-on. I tend to agree with most of what Jack says…”
So where does that leave us?
After analyzing the arguments, we arrive at a nuanced conclusion: Stablecoins are not a Global North revolution—they are a Global South breakthrough. Their true value lies not in displacing traditional banking in developed economies, but in solving real financial inclusion and liquidity gaps where legacy systems fail.
The Origins of Stablecoins: A Story of Necessity
Stablecoins didn’t emerge from theoretical innovation—they were born out of urgent market need.
Over a decade ago, demand for Bitcoin surged in Asia, particularly in mainland China. With strict capital controls limiting access to U.S. dollars, people turned to Bitcoin as a "synthetic dollar"—a digital asset that could preserve value and enable capital mobility. Chinese mining growth further fueled this ecosystem.
At the time, exchanges in Hong Kong, Taiwan, and China worked directly with local banks. Users could deposit fiat and receive crypto. But as crypto gained visibility, banks began shutting accounts—disrupting arbitrage traders and creating friction.
Arthur Hayes, former CEO of BitMEX, described this chaos:
“Every day you had to check the operational status of each bank<>exchange relationship… This was very detrimental to my profits.”
Meanwhile, many Asian economies faced currency instability—either through deliberate devaluation or financial repression via low deposit rates. The desire for dollar-denominated assets was strong. What if there was a way to hold digital dollars—24/7, borderless, and blockchain-native?
That’s where Tether (USDT) entered.
Launched in 2014 as Realcoin on Bitcoin’s Omni layer, it rebranded to Tether by November and quickly partnered with Bitfinex. The model was simple: users wire USD to Tether’s reserves; Tether mints USDT. These tokens could then be used across exchanges to trade other cryptocurrencies—without relying on slow, unreliable banking rails.
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The 2015 devaluation of the Chinese yuan by 3% amplified demand. Chinese investors sought dollar alternatives—and USDT became their go-to. As Ethereum launched and USDT migrated to its network (and later others), adoption exploded.
By 2017, Tether achieved product-market fit—not through marketing, but through necessity. It solved a real problem: accessing dollars when traditional channels failed.
Why Tether Dominates: Distribution Over Design
Tether’s dominance isn’t due to superior technology—it’s due to distribution and trust within a specific ecosystem.
In emerging markets, especially Greater China, USDT became the default digital dollar. Its value wasn’t in regulatory compliance or audit transparency—it was in ubiquity. Much like M-PESA users in Kenya don’t question whether their mobile balance is backed by shillings, Tether users don’t care about reserve audits—they care that it works.
Compare this to Circle’s USDC. Founded in 2013, it only gained traction years later—after partnering with Coinbase. Reports suggest Circle spent over $1 billion on distribution in 2024 alone.
This tells us something critical: in stablecoins, distribution is the moat.
Regulatory frameworks like the GENIUS Act (2025)—which mandates 1:1 cash/Treasury reserves, monthly disclosures, and bans big tech from issuing coins—may bring legitimacy. But legitimacy doesn’t guarantee adoption.
As history shows: utility drives adoption first; regulation follows.
People didn’t wait for AI laws before using ChatGPT. They adopted because it solved problems.
So why would someone in Louisiana switch from FDIC-insured deposits to stablecoins? What pain point does blockchain-based money solve for them?
The Global North vs Global South Divide
Let’s be clear: in highly banked economies, where financial inclusion exceeds 90% and banking infrastructure is dense, stablecoins offer little advantage.
Visa processes $14 trillion annually. Its stablecoin settlement volume? $225 million over two years—a rounding error. Even more telling: Visa has facilitated $95 billion in crypto purchases via partners like Coinbase and Crypto.com. People want to buy crypto—not spend stablecoins.
Why?
Because existing systems work:
- VISA, Alipay, UPI, Pix—centralized networks with brand trust.
- Dispute resolution is clear.
- Cashback rewards incentivize card use.
- Interchange fees are baked into the economy.
For stablecoins to compete here, they’d need to offer a 10x improvement—in speed, cost, or experience. They don’t.
Even if Walmart or Amazon issue their own stablecoins to cut $224 billion in annual U.S. swipe fees, will consumers care?
Unlikely. Credit cards offer points and credit lines—features a Walmart Coin can’t easily replicate. And unless these coins are interoperable beyond their ecosystems, they become siloed liabilities.
Where Stablecoins Do Matter: The Global South
Now look at Africa, Latin America, Southeast Asia.
Here’s where stablecoins shine:
- Dollar scarcity: Many countries lack USD liquidity.
- SWIFT delays: Cross-border payments take days due to compliance bottlenecks.
- Weekend banking gaps: No movement outside business hours.
- High remittance costs: Up to 10% fees on traditional corridors.
Enter USDT on TRON—low fees, fast settlement. Businesses move $500 million monthly across Africa using stablecoins for trade and payroll.
In Nigeria, airlines repatriate funds via stablecoins. In Brazil, freelancers receive payments instantly without relying on slow bank rails.
Stripe’s acquisition of Bridge makes sense here—not because Americans need it, but because Stripe wants to grow the internet’s GDP globally.
Treasury Management & Programmable Money
Another real use case: corporate treasury operations.
Companies like SpaceX use stablecoins to hedge FX risk and move funds across borders in real time. JP Morgan’s Kinexys and JPMD token show that even traditional banks see value in tokenized deposits—but primarily for large enterprises, not retail users.
Meanwhile, agentic AI introduces new possibilities:
- Machine-to-machine payments.
- Pay-per-API-call billing.
- Outcome-based pricing models.
While virtual cards (e.g., Mastercard x Perplexity) can power agent commerce today, programmable money on-chain offers finer control and automation—especially for microtransactions.
But again: will value accrue to stablecoin issuers—or to those who orchestrate the flows?
Stripe’s moves suggest the latter.
Frequently Asked Questions (FAQ)
Q: Are stablecoins safe for everyday use?
A: In regulated environments with transparent reserves (like USDC), yes—but their primary utility remains in cross-border transactions and treasury operations, not daily spending in developed markets.
Q: Can stablecoins replace traditional banking?
A: Not in the Global North. But in underbanked regions, they already supplement or replace broken systems—especially for remittances and dollar access.
Q: Why is Tether still dominant despite regulatory concerns?
A: Because it works where it matters most—emerging markets. Trust comes from reliability and distribution, not just audits.
Q: Will Amazon or Walmart’s stablecoins succeed?
A: Possibly within their ecosystems—but widespread adoption requires interoperability and consumer incentives that current models lack.
Q: Is regulatory clarity a game-changer?
A: It helps institutional adoption—but doesn’t create demand. Demand comes from solving real problems, not compliance.
Q: How do stablecoins help with AI-driven commerce?
A: They enable automated, programmatic micropayments between agents—something legacy systems struggle with due to latency and batch processing.
Final Thoughts: Lean Into Reality
Jack Zhang isn’t wrong—stablecoins haven’t transformed the Global North.
But he underestimates the Global South.
The volumes are already massive—and growing fast. Constraints like compliance block 95% of potential users today. Remove those barriers, and adoption will explode.
Tether understands this. That’s why its investments focus on Africa, Latam, and Asia—not Silicon Valley.
The lesson is clear: stablecoins aren’t about replacing banks where they work—they’re about serving people where banks don’t.
And that’s where the real opportunity lies.
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