Stablecoins 2.0: Exploring Blockchain Innovations for the Next Generation of Digital Currency

On July 18, 2025, President Donald Trump officially enacted the federal legislation known as the GENIUS Act, marking the beginning of comprehensive regulation for stablecoins in the United States. This development is a significant turning point for both the American cryptocurrency market and the global digital asset industry, as it allows for the legal circulation of dollar-backed stablecoins within the largest economy in the world.

**China**

In 2021, mainland China imposed a ban on cryptocurrency mining and trading activities. However, in response to the evolving international landscape concerning stablecoin regulation, a meeting was held on July 11, 2025, in Hong Kong involving the Shanghai Municipal Supervisory Committee for State Assets and local officials. This meeting was responsive to calls from industry experts and major corporations to develop a yuan-backed «stablecoin».

«Given China’s robust fintech ecosystem, it has the potential to emerge as a key player in shaping the future of blockchain-based payments,» commented Nick Rook, director of LVRG Research.

During the Lujiazui Forum in June, Pan Gunsheng, a director at the People’s Bank of China, announced the expansion of the international usage of the digital yuan, the establishment of an international center for e-CNY, and aspirations toward a multipolar currency system.

The business sector is also taking note. E-commerce giant JD.com and fintech leader Ant Group have urged the central bank to permit the issuance of yuan-based stablecoins in an effort to counter the growing influence of dollar-pegged cryptocurrencies. Both companies plan to apply for licenses to issue these coins in Hong Kong.

Market participants assert that any regulatory shifts in China may be challenging due to the country’s strict capital controls, which are likely to hinder the development of stablecoins. However, ongoing discussions are taking place, and the recent adoption of the GENIUS Act by the United States may accelerate similar regulatory movements in China.

**European Union**

On June 30, 2024, technical requirements under the MiCA framework came into effect. Firstly, stablecoin issuers must obtain a license within the EU and be registered in the relevant registry. Secondly, issuing companies are required to disclose the reserve structure backing the stablecoin, including regular liquidity and fund custody reports at secure institutions.

MiCA also imposes operational limits: a maximum of 1 million transactions per day or €200 million daily — beyond which an asset could be classified as systemically important and fall under the oversight of the European Central Bank.

In January 2025, regulatory scrutiny intensified when ESMA issued a requirement to eliminate unlicensed tokens from the market. In April, representatives of the agency also expressed concerns over the integration of cryptocurrencies with traditional finance (TradFi), highlighting the risks associated with the popularity of stablecoins and digital asset ETFs.

**United Kingdom**

The UK is developing a two-tier regulatory model for stablecoins, where the FCA will handle basic registration of issuers, reserves, and custody, while the Bank of England will oversee systemically important payment tokens. The primary proposals have already been made available for public consultation, with final rules expected by 2026. Concurrently, there is progress on launching a central bank digital currency (CBDC), although the Bank of England has indicated it will only proceed with the digital pound if it can determine its practicality.

**Russia**

In Russia, the approach to stablecoins is evolving within a framework of managed integration, aimed solely at international transactions. The foundational law regarding the digital ruble came into effect on August 1, 2023. From March 2024, a trial regime for the use of digital financial assets (DFAs), including stablecoins, for international payments has been approved, though it does not extend within the country.

The central bank supports restrictions on the use of private stablecoins, indicating these assets will not be recognized as legal tender, which will leave room only for the digital ruble, expected to be introduced on September 1, 2026.

In February 2025, a company registered in Kyrgyzstan, Old Vector, issued a ruble-backed stablecoin A7A5, which serves as an element of a parallel payment system.

**Japan**

Since June 2023, Japan has officially regulated stablecoins as «electronic payment instruments» issued exclusively by licensed banks, trust companies, or payment providers. The reserves must predominantly be held domestically, with up to 50% allowed in short-term Japanese government bonds or deposits.

Foreign issuers may operate through domestic intermediaries, demonstrating compliance with the Financial Services Agency (FSA) requirements and ensuring reserves are held in Japan. Intermediaries must carry out KYC/AML procedures, maintain segregated funds, and comply with the Travel Rule.

**South Korea**

In June 2025, South Korean authorities announced plans to legalize stablecoins based on the won, provided they are fully backed and possess a standalone reserve structure, obtaining licenses from the Financial Services Commission (FSC), along with audits and KYC/AML compliance, while assuring fund return guarantees. The central bank supports the idea but requests gradual implementation.

Potential stablecoin and CBDC issuers are generally categorized into three broad groups: banks, businesses, and governments. They all share a common need for stable operations, yet the criteria for selecting an appropriate blockchain for coin issuance may diverge.

**Bank Stablecoins: Focused on B2B and DeFi**

This category primarily targets interbank transfers, including cross-border transactions. It necessitates the support of multi-currency settlements, as banks often operate with multiple currencies simultaneously. There is also a requirement for integration with existing financial solutions, such as SWIFT and ISO 20022.

Another critical factor is liquidity within the DeFi markets, as many banks are likely to want a share of this segment. They will probably seek to incorporate decentralized finances on their terms. Future possibilities could include institutional DeFi pools, with participation limited to a list of approved addresses and protocols that have undergone KYC and AML processes. JPMorgan has already tested providing such services on Polygon and Base networks.

**Business Stablecoin: Focusing on Mass Payments and UX**

Businesses require stablecoins for purchasing goods and services, including micropayments, thus necessitating low transaction costs and predictable fees. Companies prioritize user experience (UX) and conversion, not willing to compromise convenience for hyper-security or decentralization. Solutions must function smoothly, quickly, and understandably, as average users are not inclined to deal with seed phrases or gas fees, placing UX at the forefront. Easy integration with e-commerce tools is essential.

**Government Stablecoin: Emphasizing Control and Transparency**

Governments are willing to sacrifice decentralization, convenience, and compatibility to gain full control over monetary circulation; thus, centralized blockchain architectures (or hybrids) would suffice. They principally seek control over the money supply (issuance, debits, freezes) and crime, corruption, and shadow economy prevention.

Strategic autonomy and technological sovereignty will be essential for most countries, favoring local or national developments. For instance, it’s highly unlikely that the U.S. would issue a CBDC on TRON, but theoretically, China or Russia could. A strong programmability aspect is crucial, as built-in rules would be needed for disbursing subsidies, benefits, tax collection, and spending conditions (e.g., subsidies could only be spent on food and housing). Additionally, offline transaction functionality is necessary for rural areas and non-digitized populations without internet access.

**Ethereum**

**CBDC:** Unlikely. The network is too decentralized, slow, and expensive for such applications.

**Bank Stablecoin:** Partially suitable in the DeFi segment. Used in pilot projects, particularly via Layer 2 solutions.

**Business Stablecoin:** Potentially, but just one of many options.

Without a doubt, Ethereum is the most developed blockchain ecosystem with high liquidity, which banks will want to leverage. However, the main network is too slow and expensive for mass payments, prompting financial institutions to devise cross-chain stablecoins—one set for DeFi and another for transfers.

**Ripple**

**CBDC:** Suitable. XRP Ledger has long been tested by central banks.

**Bank Stablecoin:** Well-suited, thanks to integration with SWIFT and ISO 20022.

**Business Stablecoin:** Limited applicability.

Ripple is inherently geared towards banking transactions and liquidity, supporting multi-currency accounts, with a facility to freeze funds. Its speed and low fees make it attractive (around 1500 transactions per second, with fees of approximately $0.00001). The CBDC Private Ledger is a specialized solution for central banks, used in pilots by Bhutan, Colombia, Montenegro, and Palau.

**Stellar**

**CBDC:** Suitable, but not as preferable as Ripple.

**Bank Stablecoin:** Appropriate given its strong adaptation for cross-border B2B transfers.

**Business Stablecoin:** Excellent for mass and cheap payments.

Stellar is a younger sibling of Ripple, boasting a more decentralized architecture and a greater focus on UX and mass accessibility, including payments via SMS and mobile wallets. It partners with MoneyGram, Circle, and IBM World Wire, participating in CBDC pilots.

**BNB Chain**

**CBDC:** Unlikely. Central banks are not likely to choose a commercially-driven platform.

**Bank Stablecoin:** Limited applicability. A pilot is possible, but trust among Western regulators is low; more suitable for BRICS nations.

**Business Stablecoin:** Suitable. Widely used in e-commerce, Web3, and payment solutions.

This technically adept network offers high speeds (~2000 TPS) and low fees (~$0.05). It has significant liquidity and trading volumes on DEXs, making it very appealing to banks; however, it does not support SWIFT and ISO 20022. Boasting EVM compatibility and robust infrastructure—from wallets to SDKs.

Numerous prominent business stablecoins (USDT, USDC, TUSD) already operate on BNB Chain, yet high centralization and regulatory risks render the platform unsuitable for CBDC and banking. The lack of built-in KYC further limits institutional use.

**TRON**

**CBDC:** Unlikely. Applicability may exist in certain jurisdictions, but the overall project raises doubts among Western regulators.

**Bank Stablecoin:** Limited suitability. High performance, but low trust in the Western sector.

**Business Stablecoin:** Suitable. Among leaders in mass transactions, especially in Asia and developing markets.

With its efficient network optimized for mass and micropayments, providing high speeds (~2000 TPS) and minimal fees when TRX is in the wallet, TRON is home to USDT on TRC-20—the most popular stablecoin by transaction volume, thus making it particularly attractive for retail, gaming, and cross-border transfers.

Simple integration, Binance Pay support, and a model with «energy» that negates fees present unique advantages for B2C scenarios. However, high centralization, weak institutional reputation, lack of SWIFT and ISO 20022 standards, and TRON’s contentious image limit its applicability in CBDC and banking.

**Solana**

**CBDC:** Currently unsuitable due to unstable operations.

**Bank Stablecoin:** Limited suitability. High performance, yet regulatory maturity is lacking.

**Business Stablecoin:** Suitable. Quick, economical, and actively used for retail payments and applications.

As one of the most efficient blockchains with ultra-low fees (~$0.0001) and speed apt for mass and micropayments, Solana focuses on UX, mobile wallets, e-commerce, and payment applications, making it popular among businesses. Its support for USDC and partnerships with Visa validate its practical use.

Nevertheless, past network instability, lack of SWIFT integration, cases with banks, and absence of built-in KYC infrastructure currently make it poorly suited for CBDC and institutional solutions.

**Polygon**

**CBDC:** Potentially feasible. Utilized in pilot projects but needs further adjustments for governmental requirements.

**Bank Stablecoin:** Suitable. Already used in test projects by banks (JPMorgan, Siemens).

**Business Stablecoin:** Well-suited due to scalability, low fees, and developed infrastructure.

Polygon is a mature ecosystem featuring EVM compatibility, KYC support, and active participation in banking pilots. JPMorgan conducted the first verified DeFi pool on Polygon, while Siemens launched tokenized bonds. zkEVM and CDK tools are available for creating custom chains tailored to banks and governmental needs. With very low fees, high speed, and sufficient liquidity in DeFi.

**Base**

**CBDC:** Unlikely. Its commercial nature and lack of control restrict its application in the public sector.

**Bank Stablecoin:** Suitable. Undergoing testing by institutions, including JPMorgan.

**Business Stablecoin:** Suitable. High scalability, UX, and API integrations make Base an appealing choice.

Base offers excellent user experience, high speeds, low fees, and strong ties to the Coinbase ecosystem, making the network legally and technically attractive for businesses—especially following the Flashblocks upgrade.

**Arbitrum**

**CBDC:** Not yet available. Theoretically possible through Arbitrum Orbit, but no precedents have been set.

**Bank Stablecoin:** Suitable. Already under testing by institutions.

**Business Stablecoin:** Well-suited. Low fees and scalability render Arbitrum a convenient choice.

Arbitrum stands out as one of the most mature Layer 2 solutions, attracting significant interest from institutions. Its low fees and high performance allow for the processing of mass payments.

High liquidity in DeFi may appeal to banks. There is a possibility to create custom networks via Arbitrum Orbit—potentially ideal for CBDC and banking, especially with participants like JP Morgan.

**Optimism**

**CBDC:** More suitable as an OP Stack infrastructure than as a primary blockchain.

**Bank Stablecoin:** Good for B2B and DeFi scenarios, especially with KYC/AML compliance.

**Business Stablecoin:** Possibly fitting, but more advantageous as an OP Stack infrastructure.

OP Stack’s architecture has proven to be a solid foundation for custom corporate Layer 2 solutions. This model is being actively leveraged by major players: Coinbase, Sonic, Worldcoin, and others developing the Superchain ecosystem.

OP Stack facilitates the rapid launch of custom blockchains tailored for banks, corporations, or fintech applications. It is suitable for programmable banking and corporate stablecoins within regulated DeFi, though adjustments are required for CBDC, e-commerce, and banking stablecoins.

**Avalanche**

**CBDC:** Suitable for sovereign and modular architectures.

**Bank Stablecoin:** Compatible with DeFi and multi-currency solutions addressing custom requirements.

**Business Stablecoin:** Fitting, particularly promising within private subnet networks.

Avalanche stands out with a high-performance blockchain (up to 4500 TPS with finality under 1 second), featuring a unique architecture for launching independent blockchains for specific tasks. Its EVM compatibility supports the entire Ethereum stack. Custom subnets allow setting specific rules for KYC, AML, privacy, and currency logic—a key factor for governmental and banking solutions. Avalanche is making significant strides in the institutional space (Avalanche Evergreen, case studies in Latin America).

The platform supports multi-currency operations, programmability, and cross-chain transactions, proving flexible for digital currencies in B2B and governmental sectors. However, certain constraints include the complexity of launching subnets and high resource consumption. For retail scenarios, external enhancements may be necessary. Avalanche is suitable for CBDC and banking where customization is critical, though requires adjustments for mass business payments.

**Hedera Hashgraph**

**CBDC:** Excellent fit. The architecture emphasizes control, transparency, and scalability.

**Bank Stablecoin:** Suitable. Swift, stable, compliance-oriented infrastructure.

**Business Stablecoin:** Appropriate. Ideal for large corporate solutions.

Hedera boasts a high-performing and energy-efficient DAG network with over 10,000 TPS capacity and fixed fees ($0.0001). It offers fully finalized payments—unlike blockchain solutions where transaction completion requires confirmation across multiple blocks.

It supports KYC, AML, freezing, issuance, and spending control—all at the protocol level, making the network ideal for CBDC use. Currently participating in pilot projects, including offline payments, it’s a secure and reliable platform overseen by a consortium of over 30 companies, including Google, IBM, Boeing, and Dell, with registration in the US.

However, lacking full EVM compatibility and centralized governance lessens its appeal for DeFi. If Hedera establishes itself in the decentralized finance segment, it could become a near-universal solution.

**Sui**

**CBDC:** Architecture is suitable, but no real pilots have been conducted yet.

**Bank Stablecoin:** Fitting. Innovative foundation and flexible token logic, albeit lacking maturity.

**Business Stablecoin:** Appropriate. High performance, UX orientation, and programmability make Sui appealing.

Sui is a young but technologically advanced network, utilizing the object-oriented Move language to explore new possibilities for customized tokenomics (refunds, freezes, conditional transfers, KYC). It offers high performance and low fees, making it well-suited for next-generation business stablecoins.

However, the network’s youth, non-standard development language, and weak integration with institutional and banking infrastructures currently hinder its use in public sector and banking contexts.

**Aptos**

**CBDC:** Suitable. There is potential, but as of now, the network has not been tested in the government sector.

**Bank Stablecoin:** Applicable, but lacks regulatory recognition.

**Business Stablecoin:** A good fit, particularly in Web3, gamified, and mobile scenarios.

Aptos is a high-performance blockchain platform built on the Move language, offering a high degree of token customization. The network boasts impressive performance metrics (theoretically up to 160,000 TPS) and is designed for seamless integration with Web2 and Web3 services, as well as mobile applications.

With a strong engineering team, reputable investors (a16z, Binance Labs, Jump), and a rapidly growing ecosystem, Aptos presents as a promising platform for advanced business stablecoins. However, like Sui, it remains a young network with a limited number of validators and no real-world cases in the governmental sector.

**Cardano (ADA)**

**CBDC:** Unlikely. Low speed, no practical cases or pilots available.

**Bank Stablecoin:** Unlikely. Lacks DeFi liquidity; the network requires enhancements and infrastructure development.

**Business Stablecoin:** Generally not suitable. As it stands, it’s not the most convenient choice for the commercial sector.

Cardano is a blockchain with an academic approach and high levels of formal verification. Its Ouroboros protocol ensures reliability, and a layered architecture simplifies financial solution customization. The Atala PRISM identification system provides integration opportunities with state and banking KYC frameworks.

Additionally, the platform allows for native token issuance without employing smart contracts—safe for simple stablecoin solutions. However, Cardano has no established cases involving CBDC or banks. The EUTXO model necessitates specific knowledge, and its business infrastructure lags behind competitors.

**Algorand**

**CBDC:** Well-suited—high technical maturity and support for sovereign scenarios.

**Bank Stablecoin:** Suitable—especially focusing on security and low fees.

**Business Stablecoin:** Well-suited—for micropayments, e-commerce, and automation.

Algorand stands as one of the most technically advanced platforms for government and banking digital currencies. It boasts high speeds (6000 TPS), rapid finality (up to 4 seconds), and fixed fees (around $0.001). It features built-in asset management tools (freeze, recall, clawback, whitelisting), which are critically essential for KYC/AML and regulatory control.

The platform is actively employed in governmental pilot projects (Georgia, Marshall Islands) and integrated with Chainalysis. It operates on a sustainable and energy-efficient consensus model, Pure Proof-of-Stake. However, a limited DeFi ecosystem and lack of EVM compatibility (utilizing the TEAL language) restrict flexibility and integration. While multi-currency transactions are feasible, enhancements are required at both the frontend and infrastructure levels.

**Quant**

**CBDC:** Well-suited. Functions as an infrastructural bridge between blockchains and traditional systems.

**Bank Stablecoin:** Suitable. Particularly effective in multi-network scenarios and for legacy system integration.

**Business Stablecoin:** Limited applicable. It is not a blockchain by itself, but it can facilitate integration with enterprise platforms.

Quant serves as an operational system to connect varied networks: public and private blockchains, SWIFT, Hyperledger. The platform is ISO 20022 compatible, supports KYC/AML, and aligns with banking standards. It requires an external blockchain for token issuance. It is not viable for DeFi or mass B2C transactions. Quant is best suited as an infrastructure layer for government and banking projects.

The world has reached a pivotal moment as a new wave of interest in stablecoins begins. This is affirmed by active discussions in international forums, the launch of various pilot programs, and the emergence of new legislative initiatives.

In terms of blockchains where government, banking, and business stablecoins will be issued, there currently isn’t a single ideal solution that meets all criteria. However, the most liquid networks are likely to be in demand by banks.

In the business sector, we will see a widespread launch of stablecoins in cross-chain format, with companies issuing their tokens across multiple popular networks, allowing buyers to choose their preferred ecosystem.

Cross-chain infrastructure is evolving into a standard. Tether serves as an example, possessing stablecoins across different networks. A mass release of new «stablecoins» is inevitable, and the marketplace will react swiftly.

*Text: VGI666*