Why is it said that stablecoins have completely transformed the cryptocurrency industry?

The current market capitalization of stablecoins has surpassed $310 billion, making them no longer just a medium of exchange in the crypto world but also an influential force in the global payments sector.

The previously passed “GENIUS Act” took a crucial step forward, shaping compliant stablecoins as regulated payment tools on one hand, while explicitly prohibiting issuers from paying interest or yields solely because users hold or use stablecoins on the other.

This ban changed the flow of value; the reserve income earned by issuers investing in short-term government bonds, bank deposits, and other highly liquid assets cannot be directly returned to holders, and will inevitably be redistributed across various links in the payment chain.

Thus, the focus has shifted from the relationship between issuers and users (a clear legal debate) to intermediaries such as exchanges, wallets, custodians, payment networks, and banks.

They can design various alternative forms around stablecoin balances, such as rewards, fee reductions, settlement discounts, or product access, indirectly benefiting users.

The partnership between Circle and Coinbase is a typical example: after deducting fees, the reserve income of USDC is distributed based on wallet holdings and platform contributions, with Coinbase earning substantial stablecoin revenue from it.

This is the core change brought about by the regulatory framework: GENIUS restricts direct interest payments but may not block third-party channels.

Banks worry that if exchanges or related platforms continue to offer returns under the guise of loyalty rewards, it could create loopholes to evade regulation and exacerbate deposit outflows from the banking system.

Meanwhile, the crypto industry argues that such rewards are normal business competition, not regulatory arbitrage.

If cutting off advanced reward models, banks will be more confident in confining the economic activities of digital dollars within their own balance sheets.

Cathy Wood, founder of ARK Invest, recently admitted that stablecoins have already fulfilled the role she once expected Bitcoin to play in the payments space.

Data strongly supports this: in global retail crypto activity, stablecoins already dominate, with USDT pegged to the dollar accounting for 60-90% or more of crypto trading volume in markets with capital restrictions like Venezuela and Brazil, while Bitcoin’s share remains in the single digits.

Stablecoins have become a tangible payment channel, while Bitcoin quietly refocuses its positioning, evolving toward a scarce asset, institutional reserve, and store of value.

Currently, stablecoins serve the practical function of a medium of exchange, allowing Bitcoin to avoid bearing multiple missions such as payments, store of value, and anti-inflation, thus enabling a purer narrative centered on institutional allocation and long-term holding.

It is foreseeable that the future value of the digital dollar economy—how much value directly reaches users versus how much is accumulated in intermediary layers—will depend on legislators’ tolerance for indirect yields, which is the ultimate outcome of the clear legal framework.

If platform reward channels remain open, giants controlling user and distribution channels will have an advantage; if restrictions tighten, banks and tokenized deposit products will become more attractive.

Regardless of which side the scales favor, the payment mission of stablecoins and the profit redistribution mechanisms behind them have already fundamentally rewritten the underlying logic of the crypto market.