Mastering the crypto killer-app

Important news in Q2 2025

Successful IPO for Circle

Listing on 5 June 2025 at $31, CRCL shares rose rapidly (almost 168% on the first day), peaking at around $263 in the following weeks. With a capitalisation approaching $50 billion in mid-July, this success reflects investors' appetite for securities linked to stablecoins (Circle issues USDC and EURC). The favourable regulatory environment (notably the progress of the GENIUS Act) has boosted confidence, while Circle's solid financial performance has won the attention of major funds such as ARK Invest. The hype is palpable, but several analysts (Mizuho, Goldman, JPMorgan) are warning that the model is heavily dependent on interest rate-linked revenues and could reflect too high a valuation in the face of macro risks and growing competition.

Plasma, the "Stablecoin-First"

Supported by Bitfinex and Framework Ventures, the young stablecoin-focused infrastructure raised $1 billion in two pre-sale phases on the Sonar platform in June, banking on a simple promise: to enable USDT transfers free of charge. Behind this "stablecoin-first" positioning, Plasma is seeking to differentiate itself from Ethereum, Solana and Tron with an architecture combining EVM compatibility, fast execution and anchoring on a Bitcoin sidechain. But beyond the technology, it is above all its valuation at $500m in FDV, and the concentration of deposits among a few large wallets, that are fuelling debate. The launch of the mainnet, expected in the next few weeks, will be an initial test to see whether Plasma meets a real need, or whether it is primarily a financial gamble on the growing popularity of stablecoins.

Société Général becomes first bank to launch stablecoin dollar

As The Big Whale exclusively revealed at the end of May, Société Générale's crypto subsidiary (SG-Forge) confirmed in June its intention to launch a dollar-backed stablecoin this summer, called USD CoinVertible (USDCV), which can be used on Ethereum and Solana, with US bank BNY Mellon in charge of holding the reserves. This stablecoin joins the euro offering launched in 2023 (EURVC), which currently has around 47 million euros in circulation. USDCV is intended for a variety of uses, including crypto trading, cross-border payments, cash management and collateral. It meets a growing need among players for stable, regulated instruments that are integrated into traditional banking infrastructures. Societe Generale thus becomes the first major banking institution to take the step of a stablecoin in dollars, entering into direct competition with issuers such as Tether or Circle, in a context where regulators and institutions are gradually opening up to this type of asset.

Regulatory

Adopted by the Senate on 17 June, this text introduces a regulated category of "payment stablecoins" (only issued by authorised entities, guaranteed 1:1 in cash, subject to monthly audits and AML obligations). It introduces a dual federal/state regime depending on the volume issued, and imposes a strict framework for reserves, transparency and governance. The measure still has to be approved by the House of Representatives before it can be signed into law. Its scope is already apparent: it provides a framework for a stablecoin segment worth nearly $250 billion, while reassuring players such as Circle, Coinbase and Visa, who are expanding rapidly in this area. However, some regulators and foreign central banks fear a risk of global "dollarisation" and a rise in purchases of Treasury securities.

JPMorgan advances its pioneers with a new "Deposit Token"

Presented in June 2025 under the name JPMD, this token directly represents dollar deposits held at the bank and is aimed exclusively at the bank's institutional customers via Base, the Ethereum layer 2 developed by Coinbase. Unlike stablecoins, each unit is a debt backed by a bank deposit, potentially insured and earning interest. As a result, transactions are faster, while complying with banking standards in terms of compliance. The ambitions are clear: to offer institutions a bankable alternative to stablecoins that is more compliant with accounting requirements. It remains to be seen whether this model, still very closed and centred on the JPMorgan ecosystem, will succeed in creating value beyond the internal perimeter.

USDG (Kraken, Robinhood, Mastercard) arrives in Europe

Launched in Europe on 1 July by the US company Paxos, this "Global Dollar" arrives in full compliance with MiCA regulations thanks to its licence obtained from the Finnish regulator. Available on Ethereum, Solana and other blockchains, USDG is part of a distribution network run by players such as Kraken, Robinhood and Mastercard, which will benefit from part of the reserve revenues. More than just an alternative to the giants USDT and USDC, this stablecoin, which relies on regulatory oversight, is a strategic gamble: to capture European institutions and users looking for stability and transparency. The question remains whether this distributed infrastructure, with the commitment of the payment giants, will be able to transform a promising launch into tangible use on a global scale.

A market dominated by the USDT and USDC

The stablecoin market is now worth more than $250 billion, and this digital money is far from evenly distributed. On the front line, Tether's USDT is emerging as the dominant stablecoin, supported by a multi-chain infrastructure (Ethereum, Tron, Solana, Avalanche, etc.) and distribution that eludes the major jurisdictions. Neither regulated in the United States nor authorised in Europe, USDT thrives in grey areas. It is widely used on offshore platforms, in informal payment corridors and by populations with limited access to the banking system. It is also the benchmark stablecoin for crypto exchanges, accounting for almost 70% of daily trading volumes. Tether, which publishes its reserves via quarterly certificates, has recently increased its exposure to US Treasuries (it holds more than Germany, Spain or Australia), while diversifying its income via investments in gold, Bitcoin and alternative financial products.

In contrast, Circle's USDC is following a more institutional expansion strategy. Issued by a US entity and now authorised in Europe under MiCA regulations, USDC targets regulated players: fintechs, banks, asset managers and corporates looking for a stable, compliant solution. Circle is increasing the number of integrations, whether via Coinbase, Stripe or Robinhood, and is pushing the USDC into the channels of digital commerce and cross-border payments. USDC's capitalisation remains well below that of USDT, but its share of "institutional" transactions is growing.

The rest of the market is fragmented between decentralised projects like DAI, banking initiatives like Société Générale's EURCV, or large-scale integration attempts like PayPal's PYUSD. But none has yet managed to establish itself as an alternative to the USDT and USDC, which between them structure the monetary backbone of the crypto ecosystem.

Dollar: a hegemony that is not waning

As of 10 July 2025, more than $245 billion was represented by dollar-backed stablecoins, representing more than 98% of all stablecoins in circulation. By way of comparison, stablecoins denominated in euros weigh 413 million dollars, and those denominated in Singapore dollars barely 16 million. This abysmal gap is not simply a matter of market inertia: it reflects the global demand for the dollar, seen as a safe haven in many fragile or inflationary economies. Dollar-denominated stablecoins provide access to these assets without going through the traditional banking system, which is often costly or inaccessible. They are also widely integrated into exchange platforms, DeFi protocols, and cross-border payment solutions.

In contrast, the euro and other currencies are struggling to gain traction due to a lack of equivalent natural demand and favourable regulation. In Europe, issuers have to tie up most of the reserve in low-interest bank accounts (around 1%), while in the US it is invested in sovereign bonds (around 4%).

After Visa and Paypal, the next rival is called ACH

The switchover is discreet, but it is gradually redrawing the broad outlines of the world's financial infrastructure. In June 2025, stablecoins recorded more than $2 trillion in adjusted volume over 30 rolling days, according to Artemis data. That's more than Visa ($1,300bn), PayPal ($138bn) and cross-border remittance flows ($75bn). These volumes reflect the steady rise of stablecoins, which are now used far beyond crypto-crypto exchanges: corporate payments, cross-platform settlements and transfers in areas of high currency instability.

The only network they have not yet overtaken remains the ACH, the historic banking rail in the United States, which processes around $7.3 trillion a month. The growth of stablecoins can be explained by several factors: continuous 24/7 circulation, minimal fees, native composability with DeFi, and above all a structural demand for digital dollars in regions where the greenback is scarce or subject to controls. Unlike systems such as ACH or SWIFT, stablecoins operate without intermediaries, accessible from a simple wallet, enabling them to quickly establish themselves where traditional financial infrastructures are absent, limited or too expensive.

Tether:Benefits comparable to banks

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In 2024, Tether reported $13bn in net profits, a level comparable to that of major financial institutions such as Banco Santander ($13.5bn), Mastercard ($12.8bn) or BNP Paribas ($12.6bn). This performance is all the more remarkable given that the company is not listed, does not report to any public shareholder and operates with an extremely lean structure. According to available estimates, Tether employs fewer than 100 people, compared with 29,000 at Visa, 25,000 at Mastercard and 240,000 at JPMorgan - which would put its profit per employee at over $100m, one of the highest in the world.

These profits come mainly from the returns generated by USDT reserves, which are largely invested in US Treasury bonds. Maintaining high interest rates has mechanically boosted these revenues. Tether is now looking to diversify into Bitcoin mining, artificial intelligence, agriculture in South America and even sport, with a 10% stake in Juventus Turin football club. Conversely, Circle posted a more modest profit ($200m), burdened by significant costs associated with its expansion into the regulated institutional ecosystem.

Yield: stablecoins rival US treasury bonds

Investing stablecoins such as USDT and USDC in decentralised lending protocols such as Aave often offers higher returns than one-month US Treasury bills. The annualised rate of return on USDT regularly exceeds 5%, with occasional peaks of 10% to 20% during periods of tight liquidity or high demand on DeFi platforms. By comparison, one-month US Treasuries - considered risk-free assets - have moved between 4.5% and 5.5% over the period, with much lower volatility.

This illustrates a major development: stablecoins are no longer simple transfer instruments, but genuine yield-generating assets. Against a backdrop of high interest rates, some institutional investors are starting to incorporate them into their cash management, while remaining mindful of the risks inherent in DeFi (technological, regulatory, or counterparty). The yield spread between USDT on Aave and T-Bills reflects this additional risk, but remains attractive for more offensive profiles.

Issuers between strict regulations and flexible jurisdictions

Behind the technical façade of stablecoins lies a geography that reveals the regulatory trade-offs in the sector. The majority of issuers are now based either in the United States or in more flexible jurisdictions such as the British Virgin Islands. This is the case of Tether Holdings, issuer of USDT, the world's most widely used stablecoin. Based in the Virgin Islands, the company operates outside the American and European regulatory frameworks, making it easier to distribute USDT in areas where access to the dollar is limited, notably via the Tron network. Tether manages several variants of its stablecoin, as well as tokens backed by the euro, yuan or gold.

In contrast, Circle, a US company registered in Massachusetts, takes an approach that is fully in line with the standards of traditional finance. It issues USDC and EURC, two regulated stablecoins whose reserves are held in US institutions and audited by independent third parties. Circle recently obtained an e-money establishment licence in France, enabling it to operate in the European Union under the MiCA framework - a strategic positioning to strengthen its credibility with corporates and financial institutions.

Other US issuers, such as Paxos Trust Company, complete this landscape with a B2B-oriented model. Paxos is the originator of PYUSD, the stablecoin developed with PayPal, and formerly Binance's BUSD, now on the way out. Unlike Tether, Paxos operates under the direct supervision of the New York State regulator (NYDFS), which restricts its flexibility but guarantees it a regulated and recognised framework.

In Europe, initiatives remain limited, although a few players are beginning to emerge. Société Générale-FORGE, a subsidiary of the French banking group, has been issuing the EUR CoinVertible (EURCV) since 2023, recently supplemented by a USD CoinVertible (USDV) launched in summer 2025. Iceland's Monerium, authorised as an electronic money institution, is also offering a euro stablecoin (EURe). These projects are based on the MiCA framework, but are still struggling to achieve significant volumes in the face of the dollar's dominance.

Finally, one part of the market escapes any clear jurisdiction: that of so-called "decentralised" stablecoins, such as USDS, DAI, LUSD or USDe. Issued by autonomous protocols with no identifiable legal entity, they are based on algorithmic mechanisms or over-collateralisation in cryptoassets. However, their decentralisation remains relative, with many strategic decisions often concentrated in the hands of a DAO or foundation.

Ethereum retains control of the infrastructure

Not all blockchains are playing on a level playing field in the stablecoin market. Despite the rise of more recent alternatives, Ethereum remains largely dominant, accounting for more than 50% of outstanding amounts. This position is explained by its age, its proven security and its level of decentralisation, which makes it the preferred infrastructure for regulated projects and institutional issuers. This predominance is reflected in the majority of deployments. In second place, Tron has established itself as the other pillar of the market, thanks to an aggressive strategy in support of USDT, very low fees and massive adoption in emerging zones, particularly in South-East Asia. Tron now accounts for more than 30% of stablecoin capitalisation. Behind this leading duo, the other blockchains are still marginal. Solana, Arbitrum, Base, Polygon and Avalanche are making slow progress, buoyed by targeted integrations and occasionally more dynamic volumes, but none of them has managed to build up as massive a user base as their two predecessors. The market remains polarised between the perceived efficiency of Tron and the institutional reliability of Ethereum, a split that could evolve, but which for the time being reflects the technical maturity of infrastructures and the geography of usage.

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