The next battle for stablecoins isn't about who issues the currency, but who controls the settlement channels.

Core Viewpoints

Summary: The market is discussing the CLARITY Act as a U.S. crypto market structure bill, but deeper transactions are already happening on stablecoin infrastructure: licensing, banking channels, reserve trust, cross-border settlement, and software that makes regulated digital currencies truly usable.

Everyone is watching CLARITY, but it is not law yet. Records on Congress.gov show that H.R.3633, the “Digital Asset Market Clarity Act of 2025,” passed the U.S. House of Representatives on July 17, 2025, and entered the Senate on September 18, 2025. On May 14, 2026, Senator Kevin Cramer’s office stated that the Senate Banking Committee had approved the Clarity Act, and the bill would proceed to full Senate review.

This is enough to change market expectations, but not enough to change the law itself. This distinction is important. Markets tend to trade the pathway first, then the provisions.

More critically, CLARITY did not appear in isolation. As early as July 18, 2025, the GENIUS Act had become Public Law No.119-27, establishing a federal framework for U.S. payment stablecoins. One bill attempts to define the digital asset market structure, while the other has already opened legal pathways for “cash-like tools” in the market.

Together, the questions shift. The issue is no longer whether stablecoins can survive regulation, but who can turn them into financial pipelines.

The U.S. is transforming stablecoins from transaction balances into cash-layer assets

For a long time, stablecoins were confined to a narrow box: exchange balances, offshore liquidity, DeFi collateral, and USD exposure for crypto traders.

The GENIUS Act opened this box. According to Congress.gov summaries, licensed payment stablecoin issuers must maintain 1:1 reserves, publish redemption policies, disclose reserves monthly, and comply with the Bank Secrecy Act. Compliant payment stablecoins are not considered securities under securities law.

This combination is commercially critical. A stablecoin with a statutory issuer framework, reserve rules, and redemption obligations is no longer just a trading chip but could become a settlement tool. Of course, not all stablecoins will attain this position. The significance of the new system is precisely in distinguishing stablecoins that can enter the regulated financial system from those still stuck in offshore liquidity markets.

The foreign issuer clause makes this step more substantial for the U.S. The Public Law text of the GENIUS Act addresses the issue of foreign issuers entering the U.S. market, linking access to comparable regulation, registration, and reserve requirements. In other words, a global USD stablecoin operation must also incorporate jurisdictional considerations into product-market fit.

Market interest often focuses on token design. But profits may be hidden in less glamorous areas: reserve custody, redemption operations, compliance reporting, banking relationships, and distribution channels.

Europe is not telling the same story

If the U.S. is paving the way for USD stablecoins to become regulated payment infrastructure, Europe is tackling a different issue: preventing private cryptocurrencies from undermining the single market.

Under the MiCA framework, the European Banking Authority (EBA) states that asset-referenced tokens and electronic money tokens must obtain relevant authorization to operate within the EU. EBA will also assess whether tokens are significant; once they meet significance criteria, EBA can assume direct or joint supervision responsibilities.

This is not just a matter of wording but reflects different business environments. The U.S. discusses market structure and USD competitiveness, while Europe is more concerned with monetary sovereignty, consumer protection, market integrity, and regulatory transparency.

For entrepreneurs, Europe is not a market where you can scale first and then comply later. Products must be compliant from day one. Custody, disclosures, reserve monitoring, listing controls, wallet screening, and regulatory reporting are not backend details—they are market access requirements.

In Europe, compliance is not a tax on the product but part of the product itself.

Hong Kong makes Chinese-language market opportunities concrete

Hong Kong is the most promising place for Chinese entrepreneurs to seriously consider stablecoins.

The Hong Kong Monetary Authority (HKMA) states that after the Stablecoin Ordinance takes effect on August 1, 2025, issuing fiat-backed stablecoins becomes a regulated activity requiring licensing. The HKMA registry shows two stablecoin issuer licenses effective from April 10, 2026: Anchorpoint Financial Limited and HSBC Hong Kong.

The list is short, but that’s the point—the scarcity will generate a market around licenses.

Licensed issuers need reserve reports, redemption systems, transaction monitoring, wallet controls, merchant integrations, and exchange connectivity. Banks and brokerages will engage with stablecoins but cannot inherit all crypto risks. Tokenized funds and securities require cash legs. Exporters and regional SMEs need faster settlement and cleaner reconciliation.

Hong Kong’s value lies in bridging Chinese business networks and international financial rules. But it is not a backdoor into Mainland China. This distinction will determine which products are worth investment and which are just regulatory illusions.

A more realistic Hong Kong opportunity is not retail speculation but offshore Chinese-language financial infrastructure.

Asia will not become a unified stablecoin market

Many entrepreneurs mistakenly see Asia as a unified stablecoin market. Regulators are doing the opposite.

Singapore’s framework focuses on single-currency stablecoins issued in Singapore, pegged to SGD or G10 currencies. MAS materials show that reserve assets must be low-risk, highly liquid, at least equal in value to circulating stablecoins, and held by qualified custodians; redemption at face value must occur within five business days.

Japan leans more toward institutional pathways. The FSA framework indicates that digital currency stablecoins can only be issued by banks, funds transfer service providers, and trust companies, with requirements for face-value redemption and price stability. JPYC completed its funds transfer service registration in August 2025, showing that Japan’s system can lead to real issuance paths but through a very conservative boundary.

The UAE is more like building a payment corridor. The Central Bank announced the Payment Token Services Regulation in June 2024, covering issuance, custody, transfer, exchange, and including AML, consumer protection, conduct standards, risk management, and technology-neutral principles.

The UK and Canada are not standing still. The Bank of England released a consultation on systemic stablecoins on November 10, 2025; Canada’s Finance Ministry announced that its proposed framework will require non-bank fiat stablecoin issuers to register with the Bank of Canada, maintain 1:1 high-quality reserves, and offer face-value redemption, with rules expected to take effect after consultation, around 2027.

The result is not a single global stablecoin system but a patchwork of different payment corridors. Each corridor has its own currency, licensing, banking partners, redemption rules, and customer base.

This is more complex than a universal token story but closer to where real companies are born.

Issuers are not necessarily the best business

Visa data shows stablecoin supply grew from $186 billion in December 2024 to $274 billion in December 2025; after excluding high-frequency trading wallets, smart contract addresses, and bot activity, adjusted trading volume in 2025 is expected to exceed $10 trillion.

Large numbers attract issuers, but big figures do not automatically translate into viable economic models.

Issuing stablecoins requires capital, licenses, and strong operational capabilities. The less crowded opportunities may lie beneath issuers—in tools that make stablecoins accepted by enterprises.

This includes payment orchestration connecting multiple licensed partners, funds management software for exporters and platforms, reserve and attestation dashboards for issuers, wallet screening, sanctions controls, Travel Rule workflows, transaction monitoring, and infrastructure for tokenized funds, bonds, and RWA with cash legs.

Customers are not abstract “crypto users.” They are payment companies seeking shorter settlement times, brokerages supporting tokenized assets, SMEs paying suppliers, funds handling subscriptions and redemptions, or wallets wanting to stay within regulatory boundaries.

Chinese entrepreneurs may have an advantage here. Many teams understand cross-border trade, offshore structures, Asian payment fragmentation, and Chinese-language merchant networks. But products cannot just be “cheaper stablecoins.” They must solve workflows: save time, reduce capital lock-up, improve reconciliation, or open underbanked payment corridors.

Stablecoins can be behind the scenes, but their benefits must be front and center.

The real challenge lies with banks and regulators

The most uncomfortable part of stablecoin opportunities is that crypto teams do not fully control the most critical resources.

They need bank accounts, reserve custodians, payment partners, auditors, compliance staff, transaction monitoring, anti-fraud operations, legal advice, and local fiat liquidity. They need licenses or a licensed partner. Blockchains can change, but trusted banking relationships are hard to replace.

This is why the next cycle may reward “distribution with compliance capabilities.” Pure regulatory arbitrage becomes less sustainable. Low-margin models that cannot afford compliance costs will struggle. Projects relying on fuzzy jurisdictional positioning will be harder to sell to institutions.

There is also a macro constraint. BIS has warned that stablecoins could trigger currency sovereignty concerns and weaken foreign exchange controls. BIS also notes that stablecoins currently mainly provide foreign currency entry points—primarily USD—in countries with high inflation, capital controls, or restricted USD accounts; in such contexts, stablecoins are especially attractive to users and businesses.

This tension is the business itself. Users want better liquidity for USD; regulators want traceable fund flows. Winners will not ignore this tension but productize it.

Mainland China has clearer boundaries. The Library of Congress’s summary of 2021 documents from the People’s Bank of China and other agencies reiterates that virtual currencies do not have the same legal status as fiat currency and highlights risks of trading and speculation. For Chinese-language teams, a safer path is not to develop crypto products for retail users in Mainland China but to build compliant infrastructure within jurisdictions where rules permit.

What Chinese entrepreneurs should do

The best starting point is not a token whitepaper but a real customer with a painful payment or settlement process willing to pay for a solution.

Exporters need invoice-linked receivables, controlled conversions, and supplier payments. Market platforms need cross-currency, cross-jurisdiction seller settlement. Tokenized funds need subscription, redemption, and reporting channels. Wallets need screening and Travel Rule workflows. Licensed issuers need transparency in reserves and redemption operations. Acquirers need stablecoin settlement that looks like ordinary receivables.

These businesses are less glamorous than issuing tokens but may be more sustainable.

Entrepreneurs should ask very specific questions: Where are the customers? Which currencies? Which licenses are needed? Who are the banking partners? What are the compliance obligations? Which part of the workflow is painful enough to pay for?

If the answer is just “stablecoins are the future,” that’s not yet a business.

Conclusion: The new premium is legal operating capability

CLARITY is not law yet; GENIUS already is. MiCA is in effect. Hong Kong has issued stablecoin licenses. Singapore, Japan, the UAE, the UK, and Canada are defining their boundaries.

Looking at all together, the market is moving away from pure offshore status. Stablecoins are no longer just exchange balances but are becoming candidates for settlement infrastructure. This shift will not simplify the market; it will make it more institutionalized, fragmented, and license-dependent.

For entrepreneurs, opportunities remain large, but the focus has shifted. The next stablecoin cycle may not belong to the loudest issuers but to those who can access the right channels, earn trust from banks and regulators, and develop regulated digital currencies that function like ordinary financial tools.

This is harder to spread than issuing tokens, but it is more valuable.

Risk Disclaimer

This article is for industry information and research purposes only and does not constitute investment, legal, or tax advice. Policies, licensing, and market conditions related to virtual assets change rapidly; please refer to official disclosures from regulators, exchanges, and projects.