Stablecoins are crypto assets that aim to stabilize their value by being pegged to commodities such as fiat money and gold. Stablecoins serve as a "safe haven" for investors trading in cryptocurrency markets by exchanging their volatile assets, such as Bitcoin. They stand out as a fast and cheap solution against the slow and costly structure of the traditional banking system and as a strong alternative in international transfers. In addition, as the basic building block of the decentralized finance (DeFi) ecosystem, they play an indispensable role in areas such as lending, liquidity provision and yield farming.
Stablecoins, the most important financial innovation of recent years, are now at the center of the global competitive strategies of states. Global powers, especially the U.S., want to be involved in this ecosystem and lead the field, to build a bridge between the traditional and digital financial worlds, and to reshape the future of money and payment systems. This versatile functionality makes stablecoins stand out as a means of influencing the global economic order of the 21st century.
In contrast to the dayslong transfer times of outdated international payment systems and intermediaries, stablecoins have revolutionized the blockchain infrastructure with near-instantaneous value transfer, programmable payment flows and on-chain auditability. The technical advantages include increased transaction speed, widening financial access to regions where traditional banking infrastructure is weak, increasing the liquidity of assets thanks to tokenization and enabling new business models with micropayments. Now that businesses can make instant payments to their international suppliers, they can increase their trade volumes and strengthen their cash flows by quickly receiving payment for cross-border sales.
However, there are also downsides. Strategically, states face the risk of losing control over their monetary policies, especially if dollar-backed stablecoins become the global interface. At this point, the Trump administration is pioneering the tokenization of the dollar and the reshaping of global payment systems. This puts pressure on many countries to develop a national stablecoin to maintain their financial independence and to expand the use of their currency in international trade.
The U.S. brought regulatory clarity with the GENIUS, CLARITY and Anti-CBDC laws passed in the summer of 2025 to bring the dollar's reserve currency status into the digital age. This move by the Trump administration will allow the private sector to deploy dollar-based stablecoins on a global scale, reinforcing the U.S.' financial leadership. In this way, the tokenized dollar will facilitate trade and capital flows by providing fast liquidity through banks and fintech companies. The U.S. thus ensures that global digital liquidity remains largely in dollars. Anti-CBDC legislation to restrict the Federal Reserve from directly issuing a central bank digital currency (CBDC) indicates that competition will be fought over stablecoins. The Trump administration places stablecoins at the centre of its geoeconomic strategy to establish the digital dominance of the dollar and give the U.S. a lasting influence over the global financial system.
On the other hand, actors such as the European Union and the U.K. are adopting a more cautious approach. Although they are working on both CBDC and regulated private stablecoins with the concern of maintaining existing financial stability and supervision, they are lagging behind the U.S.' aggressive expansion strategy. This situation strengthens the possibility that global payment systems will be shaped around U.S.-based tokens in the coming period.
In the global stablecoin race, countries' strategies reflect their economic interests and geopolitical goals. The U.S. sees the adoption of dollar-backed stablecoins as the most effective way to maintain its reserve currency status. Legislative regulations, which have gained momentum especially during the Trump administration, are increasing U.S. dominance in global payment networks by attracting banks and private companies to this ecosystem. For example, the GENIUS Act's incentive for stablecoin issuers to hold reserves in Treasury bills further reinforces the global demand for the dollar. U.S.-based financial institutions and technology companies seem to be the biggest beneficiaries of this situation.
Although China has long restricted crypto transactions and focused on digital yuan (e-CNY), it has recently signalled a potential opening toward yuan-backed stablecoins. In particular, Hong Kong-based offshore trials suggest that China wants to internationalize its currency with a controlled stablecoin model. However, Beijing's steps are still very cautious due to concerns about capital controls and supervision.
Other emerging economies and regional powers do not want to be left behind in this race. Southeast Asian and Middle Eastern countries are trying to modernize their payment infrastructures through both CBDC and private stablecoin projects. But I think the real risk for many of these countries is that their financial systems will be marginalized as global liquidity shifts largely to dollar and euro-denominated tokens.
As a result, stablecoins have already become an important financial asset class. As of September 2025, the total market value of dollar-based stablecoins has reached 300 billion. Projections from organizations such as JPMorgan, Goldman Sachs and Citi indicate that this trend will only get stronger. It is clear that stablecoins, which are turning into a global competitive tool, will play a critical role in cross-border transactions and capital markets. However, when dollar-based stablecoins led by the U.S. dominate the ecosystem, fiat currencies, especially those of third-world countries, may lose their "credibility." While the Trump administration designs global trade and payment systems through stablecoins, the transparency and on-chain traceability offered by blockchain may turn into the image of "Big Brother" in Orwell's "1984." The wallet addresses frozen on the grounds of "terrorism" are a concrete example of this.
With instant and permanent recording of transaction flows, surveillance of economic behavior can be turned into policy tools. For many states, this potential risk of misuse will be a sovereignty and privacy issue above the financial dimension. Therefore, strong legal frameworks, data protection guarantees and privacy-preserving cryptographic solutions need to be implemented in parallel with national stablecoins designed to protect national interests, data sovereignty and financial stability. Ultimately, the stablecoin competition is not just a race for technology and liquidity; it is a geoeconomic struggle over which actor will shape payment infrastructures, data sets, and thus, economic behavior.
