The most notable development came from Cloudflare, which launched a stablecoin and added support for the x402 protocol. The move pushes the narrative of a true “internet money layer” into practice, positioning stablecoins as a potential inflection point for the value-driven internet—reshaping AI payments and the creator economy.

On the macro front, stablecoins are emerging as the front line of global currency competition. The U.S. is leveraging regulatory clarity to attract capital and bring companies back onshore, while emerging markets and Europe are accelerating plans for domestic stablecoins to counter dollar expansion and reinforce monetary sovereignty.

Improved compliance and fresh capital are accelerating the sector’s institutional turn. A wave of funding activity this week underlines how stablecoins have moved from a niche narrative into the foundation of global finance—driving new business models and technical iterations, but also accumulating competition and potential bubble risk.

Overall, stablecoins are transitioning from the edges of innovation to the heart of financial infrastructure. The industry is entering a decisive phase of scale and market maturity.

Market Overview & Growth Highlights

Total stablecoin market cap reached $295.616b, with a week-over-week increase of $3.788b. In terms of market structure, USDT continues to maintain its dominant position at 58.66%; USDC ranks second with a market cap of $73.685b, accounting for 24.93%.

Blockchain Network Distribution

Top 3 Networks by Stablecoin Market Cap:

1. Ethereum: $159.64b

2. Tron: $77.021b

3. Solana: $13.447b

Top 3 Networks by Weekly Growth:

1. M By M^0 (M) : +51.83%

2. PayPal USD (PYUSD) : +43.48%

3. Global Dollar (USDG) : +10.49%

Data from DefiLlama

🎯Cloudflare enters stablecoins with NET Dollar, moving from information pipes to value pipes.

Cloudflare, which routes roughly one-fifth of global internet traffic, announced the launch of its own U.S. dollar stablecoin, NET Dollar, in partnership with Coinbase to advance the x402 protocol. With millions of websites, developers, and enterprises already relying on its network, Cloudflare’s entry extends stablecoins beyond crypto trading or emerging market remittances, positioning them as a structural layer for mainstream commerce and the wider digital economy.

The combination of NET Dollar and x402 directly targets an unsolved problem: micropayments. Until now, transaction fees and intermediaries have kept “internet-native payments” largely theoretical. By embedding a stablecoin within Cloudflare’s distributed infrastructure, value could begin to flow across the web as seamlessly as data packets. For developers, this opens finer-grained monetization of APIs, compute, and content. For AI systems, it surfaces a deeper issue—how to compensate for the training data that fuels them.

A true AI-native payment stack, however, requires more than value transfer. Emerging standards aim to address trust and identity: the AP2 protocol links payments to verifiable user intent, preventing errors triggered by AI hallucinations; ERC-8004 and account abstraction provide agents with digital passports and controllable permissions. Combined with x402, these form a closed loop of payments, trust, and identity—an essential foundation for secure and scalable AI transactions.

In the long run, Cloudflare’s move signals that the ad-and-banking rails of the last internet era are giving way to usage-based and microtransaction economics. As CEO Matthew Prince noted, the abundance of AI-generated content pushes scarcity onto human time and attention. In this next phase, the internet economy will be shaped less by content volume and more by value curation—only resources that truly cross the attention threshold will be rewarded.

That is the significance of NET Dollar and x402: as the free model erodes, a new value layer is taking shape atop internet infrastructure. Every request—whether for data, compute, or services—can carry a small but meaningful payment, creating a more efficient channel to separate signal from noise in an age of information overload.

🎯Tether seeks funding at a $500B valuation, but its “free lunch” model faces an end.

The stablecoin market is undergoing rapid structural change, and Tether remains its undisputed leader. Powered by USDT, it dominates share and profitability. Now, the issuer is reportedly seeking new funding at a staggering $500 billion valuation—putting it on par with global giants such as OpenAI and SpaceX.

At first glance, such a figure might seem defensible given Tether’s $172 billion in circulation and huge profit run rate. But stripping out roughly $5.5 billion in cash, Bitcoin, and equity holdings from its balance sheet, the implied multiple becomes ~68x enterprise value to annualized revenue—a level that in traditional finance is reserved only for high‑growth tech companies with durable moats.

Tether, by contrast, is highly exposed to macro conditions. Its profit engine depends on prevailing interest rates: user deposits are invested in safe assets, with all yield captured by the company while no interest is returned to holders. This “unregulated bank” model has been immensely profitable in a high‑rate environment, but becomes fragile if the Federal Reserve cuts.

Meanwhile, its moat is eroding. Regulatory clarity—through frameworks such as the GENIUS Act—is ushering in an era where big tech platforms, payment firms, or messaging apps can issue compliant stablecoins at scale. As stablecoins commoditize, competition will shift from balance sheet to distribution—a dimension where Tether is far less advantaged.

Pressure is also coming from users and developers. Demands are growing for issuers to share a portion of yield with token holders, mimicking deposit rates in traditional banking. If newcomers adopt such incentives, Tether risks customer outflows. Its strongest remaining defense lies in brand loyalty across emerging markets, where USDT is still seen as a hedge against local inflation and a trusted store of value. Yet even here, rivals are intensifying efforts.

A $500 billion valuation, then, looks less like a reflection of structural strength and more like a bet on brand inertia. For Tether, the “free lunch” era of pocketing risk‑free yield without sharing it may be nearing its end.

🎯Capital flows into stablecoins: five investment trends shaping the sector

This week, funding activity across the stablecoin ecosystem surged, with several large rounds underscoring unprecedented investor attention. In the first nine months of 2025 alone, startups in the sector raised an estimated $537 million—a more than 5x increase over the $84 million raised in all of 2024. The acceleration is unmistakable.

Capital is clustering around a few clear themes: AI‑driven payment infrastructure, enterprise‑grade compliant services, and deeper integration between traditional finance and blockchain. The momentum is powered by clearer regulation, entry from major financial incumbents, and rising adoption in emerging markets. Together, these forces point to stablecoins forming the monetary layer of the digital economy. At the same time, high‑profile cases like Tether’s $500B valuation highlight growing concerns over inflated pricing and the sustainability of business models.

We tracked at least 11 major funding deals this week, totaling several hundred million dollars (excluding Tether’s mega‑raise). Notable late‑stage rounds and new unicorns emerged across four fronts:

1. AI agent networks are attracting capital. Firms like Crossmint, Circuit & Chisel, and YC‑backed “Fintech 3.0” startups are betting that autonomous agents will drive high‑frequency, low‑value transactions—requiring stablecoins as the native currency of AI economies.

2. Enterprise‑grade infrastructure remains a top draw. Bastion’s “stablecoin‑as‑a‑service” and Zerohash—dubbed the “on‑chain AWS”—offer issuance, reserve, and liquidity management within regulatory frameworks.

3. Traditional finance integration is accelerating. Fnality brought in global banks to advance tokenized central bank money; Zerohash secured backing from Interactive Brokers and Morgan Stanley; PayPal and Stripe are anchoring use‑cases for stablecoin payments. These efforts lock incumbents into the tokenization trend, positioning for efficiency and future digital asset rails.

4. Cross‑border payments and emerging markets continue to drive adoption. RedotPay and Shield are targeting LatAm, Africa, and Asia, while PayPal invested in Stable to strengthen its footprint in the Middle East and Africa. Stablecoins prove strongest where settlement inefficiencies remain most acute.

5. Valuation pressure versus optimism defines investor sentiment. Tether’s $500B fundraising pursuit illustrate optimism but also raise questions over profitability and heavy reliance on interest‑rate cycles. Investors and regulators alike are pushing for sustainable monetization models beyond the growth narrative.

Overall, capital is rushing in, but so are expectations. Stablecoins are moving from edge narrative to core financial infrastructure, and the investment community now demands both scale and durability.

Market Adoption

🌱As stablecoins evolve into payment infrastructure, AWS has emerged as the platform of choice for startups in the sector. Firms like Zerohash, Yellow Card, and Bastion are building on Amazon’s cloud to power cross‑border payments, payroll, and treasury management, citing its security and scalability. AWS supports stablecoin infrastructure with tools like Amazon EKS for workloads, Nitro Enclaves for secure signing, and serverless services such as Lambda and DynamoDB, helping cut operating costs by up to 50%. With on‑chain stablecoin transactions surpassing $27.6 trillion in 2024, Citi forecasts supply could reach $1.6–3.7 trillion by 2030.

🌱Fold has partnered with Stripe and Visa to launch the first credit card offering pure Bitcoin rewards. Powered by Stripe Issuing and running on Visa’s network, the card gives users 2% back in Bitcoin instantly, with up to 3.5% available when paired with a Fold checking account, and up to 10% at retail partners like Amazon and Target. Rewards are automatically delivered in real Bitcoin without staking or exchange accounts. Fold has processed more than $3.1 billion in transactions and distributed $83 million in Bitcoin rewards. The launch extends Fold’s suite of Bitcoin‑native financial tools and lowers barriers for everyday adoption.

🌱Kaia and LINE NEXT, the Web3 arm of LINE, have announced Project Unify, a stablecoin “super app” set to launch later this year through LINE’s Dapp Portal. The service integrates remittances, consumer payments, and on/off‑ramps into one interface, allowing users to deposit stablecoins for yield, send funds via messaging, and pay online or in‑store with rewards. It will support stablecoins tied to the U.S. dollar and major Asian currencies including JPY, THB, KRW, IDR, PHP, MYR, and SGD. Backed by LINE’s and Kakao’s messaging platforms, the initiative aims to unify fragmented Asian payment rails and drive mass adoption of stablecoin‑based financial services.

New Launches

👀Rainbow plans to launch its native RNBW token by the end of 2025, linking it to its non‑custodial crypto wallet and existing user points program. The announcement comes just days after Consensys founder Joe Lubin confirmed MetaMask is building a MASK token, signaling a broader wallet‑tokenization trend. Rainbow also unveiled product upgrades including live price updates, faster balance refresh, enhanced price charts, and perpetuals trading via Hyperliquid. The roadmap extends to DeFi position tracking and multi‑chain support. Analysts say RNBW could deepen user loyalty and position Rainbow more competitively against MetaMask and Coinbase as wallets evolve into tokenized ecosystems.

👀 World Liberty Financial co‑founder Zak Folkman announced at Korea Blockchain Week that the firm will soon launch a debit card linking its USD1 stablecoin and app to Apple Pay, alongside a retail app described as “Venmo meets Robinhood.” The platform will combine peer‑to‑peer payments with trading features while avoiding building a proprietary blockchain—positioning itself as chain‑agnostic and distribution‑neutral. Backed by members of the Trump family, the company introduced WLFI tokens and USD1 stablecoin in September 2024 but has seen WLFI’s price fall 37% since launch. A new partnership with Korea’s Bithumb highlights its effort to bridge traditional finance and on‑chain markets globally.

👀ChaosChain has released an SDK for autonomous agents designed to enable trusted AI‑driven payments. Installed via a simple pip install, the toolkit integrates ERC‑8004 identity, reputation, and verification registries, supporting crypto and traditional payment methods across Base, Ethereum, and Optimism’s Sepolia testnets. Its “triple‑verification stack” addresses trust: Google AP2 intent validation (ensuring human authorization), process integrity checks (verifying correct code execution), and ChaosChain adjudication (verifying outcome value), with ChaosChain controlling two of the three layers. By creating transparent and verifiable trust infrastructure, the SDK could underpin secure AI‑agent use in DeFi risk forecasting, autonomous e‑commerce, and decentralized service markets.

Big Picture

🔮 Citibank has raised its forecast for the global stablecoin market, projecting issuance could reach $1.9 trillion by 2030 under its base case and up to $4 trillion in a bullish scenario. The sector has already expanded from $200 billion in early 2025 to $280 billion today, with potential annual transaction volumes of $100–200 trillion if turnover matches fiat currencies. Citi notes that tokenized deposits may ultimately surpass stablecoins in volume, driven by demand for regulatory safeguards and real‑time settlement. The bank frames stablecoins and tokenized deposits not as rivals but as twin pillars of a redesigned financial infrastructure, still dominated by the U.S. dollar.

🔮The U.S. Treasury Secretary Scott Bessent and U.K. Chancellor Rachel Reeves have launched a Transatlantic Taskforce to coordinate policy on digital assets and capital markets. The group will bring together officials from both treasuries and market regulators, producing recommendations within 180 days through the existing U.K.-U.S. Financial Regulatory Working Group after industry consultation. While covering traditional markets, its key focus is expected to be digital assets, spanning short‑term cross‑border use cases and long‑term wholesale digital infrastructure. The initiative signals closer alignment between two global financial hubs, potentially setting benchmarks for transparency and accountability in digital regulation. Analysts say it could reshape global policy frameworks.

🔮 A new EY survey finds the recently passed GENIUS Act is accelerating stablecoin adoption for cross‑border payments. Thirteen percent of companies already use stablecoins, while 54% of non‑users plan to adopt them within 6–12 months, citing cost savings as the top driver—41% of current users report at least 10% fee reductions in international transactions. The Act provides long‑awaited clarity on reserves, custody, taxation, and liquidity requirements, easing integration concerns. Executives project stablecoins could capture 5–10% of global cross‑border payments by 2030, equivalent to $2.1–4.2 trillion. Analysts say regulatory certainty marks a turning point for enterprise adoption, though infrastructure integration remains a key hurdle.

Capital Deployment

💰 Hong Kong–based RedotPay has raised $47 million in strategic funding, pushing its valuation above $1 billion and securing backing from Coinbase Ventures, Galaxy Ventures, and Vertex Ventures. Founded in 2023, the stablecoin payments startup already serves over 5 million users across 100+ markets, processing $10 billion in annual transaction volume through its stablecoin card, multi‑currency wallet, and global payment services. Its platform enables direct transfers from stablecoins to local bank accounts and e‑wallets, with strong traction in emerging regions like Latin America. The unicorn milestone comes as competition among stablecoin issuers and payment rails intensifies amid increasingly defined global regulatory frameworks.

💰 Cloudburst Technologies has raised $7 million in a Series A round led by Borderless Capital, with participation from Strategic Cyber Ventures, CoinFund, Coinbase Ventures, Bloccelerate VC, and In‑Q‑Tel, bringing total funding to $11 million since its 2022 launch. Unlike traditional on‑chain analytics providers, the New York–based firm focuses on off‑chain intelligence, aggregating data from Telegram, forums, regulatory filings, and media to track fraud networks, illicit actors, scams, and sentiment. Its platform applies proprietary AI to millions of off‑chain signals, providing real‑time threat detection for exchanges, compliance teams, and regulators. The funds will expand its AI and data science teams and accelerate global product deployment.

💰PayPal has pledged to invest $100 million across the Middle East and Africa to accelerate digital commerce and financial inclusion. The commitment will be deployed through minority investments, acquisitions, PayPal Ventures, and technology and talent expansion, targeting one of the world’s fastest‑growing digital economies. It follows PayPal’s April launch of a regional hub in Dubai, designed to support enterprises and small businesses with frictionless payments, enhanced security, and global market access. PayPal Ventures has already backed local startups such as Tabby, Paymob, and Stitch. The initiative underscores PayPal’s ambition to strengthen regional ecosystems while solidifying its role as a global payments leader.

💰Circle Ventures, the corporate venture arm of Circle Internet Group, has made a strategic investment in Crossmint to expand adoption of stablecoin‑based payments. Crossmint will integrate Circle’s USDC with its wallet and API stack to offer on‑ramps, transaction orchestration, and agent‑driven payment services for billions of users, enterprises, and AI systems. The partnership already underpins initiatives ranging from MoneyGram’s remittance redesign to fintech product launches and Google collaborations on intelligent agent payments. By merging USDC’s regulatory strength with Crossmint’s infrastructure, the deal aims to accelerate low‑cost, global, real‑time transaction innovation. It highlights stablecoins’ transition from niche technology to a mainstream payment layer.

💰Bastion, a regulated stablecoin infrastructure provider, has raised $14.6 million in a strategic round led by Coinbase Ventures with participation from Sony Innovation Fund, a16z crypto, Samsung Next, and Hashed, bringing its total funding above $40 million. The company offers a “Stablecoin‑as‑a‑Service” platform that equips enterprises and financial institutions with issuance, reserve management, liquidity, and compliance‑ready tools for large‑scale stablecoin use. Recent hires include senior leaders across revenue, finance, legal, and risk to meet surging global demand. With a New York DFS trust license and multiple state approvals, Bastion positions itself as a key enterprise gateway to safe, regulated stablecoin adoption worldwide.

💰 Fnality has raised $136 million in a Series C round led by WisdomTree, Bank of America, Citi, KBC Group, Temasek, and Tradeweb, with Goldman Sachs, UBS, and Barclays also participating. The fintech builds tokenized versions of major currencies backed by central bank cash, enabling real‑time settlement, delivery‑versus‑payment for securities, and payment‑versus‑payment for FX trades. The funds will support expansion into additional currencies, enhanced liquidity tools, and settlement of tokenized securities and stablecoins. Fnality has already launched an on‑chain sterling payment system in the U.K. Executives describe the financing as a milestone toward a “hybrid future” where traditional finance and decentralized markets integrate seamlessly.

💰ZeroHash has raised $104 million in a Series D‑2 round led by Interactive Brokers, with participation from Morgan Stanley, SoFi, and Apollo Global, pushing the crypto infrastructure firm’s valuation to $1 billion. The deal ranks among the largest crypto and stablecoin financings of 2025. Positioned as the “AWS of on‑chain infrastructure,” ZeroHash powers solutions for Stripe, Interactive Brokers, and BlackRock’s BUIDL fund, serving more than 5 million users across 190 countries. The new capital will support product expansion, team growth, and scaling for enterprise tokenization and payments. The funding underscores how institutional capital is accelerating blockchain adoption as stablecoins and tokenization move into mainstream finance.

💰 Startup accelerator Y Combinator has teamed up with Base and Coinbase Ventures to launch the “Fintech 3.0” initiative, now open for applications from founders building next‑generation financial services on blockchain infrastructure. The program will focus on three areas: expanding stablecoins beyond the U.S. dollar into local currencies, tokenizing assets like equities and credit markets, and developing consumer‑facing apps such as AI‑driven financial agents. Base, Coinbase’s Ethereum Layer‑2 network, recently partnered with Shopify to enable global USDC payments, underscoring the push to migrate finance on‑chain. The move comes amid clearer U.S. regulation, signaling that blockchain finance is shifting from experimentation toward mainstream adoption.

💰Bullish, newly listed on the New York Stock Exchange, has invested $4 million into USD.AI through its venture arm, Bullish Capital. USD.AI issues synthetic dollars to finance AI infrastructure, offering standardized loans collateralized by GPU hardware. The platform, still in private testing, has already attracted $250 million in deposits. Bullish CFO David Bonanno said tokenization represents the “core of next‑generation capital markets,” and USD.AI brings that trend into the capital‑intensive AI sector. The deal highlights how digital asset firms see opportunities in pairing DeFi models with institutional‑grade risk management to address the financing gap in AI infrastructure.

💰Former Stripe executives Louis Amira and David Noël‑Romas have launched Circuit & Chisel and raised $19.2 million to develop the ATXP protocol, billed as the “HTTP of agent payments.” ATXP aims to enable AI agents to communicate and transfer funds, allowing them to complete complex, money‑involved tasks such as booking travel or executing investment strategies—something current systems cannot perform. The funding round was led by Stripe, with Primary Venture Partners, ParaFi, and Coinbase Ventures participating. Built to integrate with Stripe’s Tempo stablecoin blockchain, ATXP will compete with payment‑oriented agent frameworks from Google and Coinbase. If successful, it could unlock microtransactions and catalyze a broad agent‑based app ecosystem.

💰PayPal Ventures has made a strategic investment in Stable, with plans to integrate PayPal USD (PYUSD) into Stablechain, a blockchain purpose‑built for stablecoins. The partnership aims to address gaps in current infrastructure—volatile fees, inconsistent settlement times, and fragmented tools—by leveraging Stablechain’s use of USDT for gas, sub‑second confirmations, and enterprise‑level throughput. David Weber, head of PYUSD at PayPal, said the move will expand PYUSD’s utility across multi‑chain ecosystems, while PayPal Ventures partner Amman Bhasin highlighted real‑world applications in emerging markets. By combining PayPal’s global reach with Stablechain’s technology, the effort positions stablecoins for mainstream payments, commerce, and financial products.

💰Crypto neobank Shield has raised $5 million in seed funding led by Giant Ventures, with backing from the a16z crypto accelerator, Factor Capital, Coinbase, and Bank of America as strategic investors. The platform enables importers and exporters to settle cross‑border payments in U.S. dollar stablecoins, while offering built‑in compliance tools such as sanctions screening and anti‑money‑laundering checks. Since launch, Shield has processed over $100 million in payments, including $40 million last month alone. CEO Emmanuel Udotong said the company targets the costly delays in global trade settlements common in Latin America, Africa, and parts of Asia. Shield plans to expand banking partnerships and enhance compliance products, positioning itself against payment majors like PayPal’s Xoom and Stripe’s Bridge.

💰“Stablecoin startups have raised a record $537 million in 2025, up fivefold from $84 million last year, underscoring surging investor interest. OSL Group, a Hong Kong‑based infrastructure firm, closed a $300 million equity round in July, the year’s largest deal; including Circle and Figure, total industry fundraising now exceeds $2.4 billion. Competition is heating up as traditional finance giants join the race: Stripe has announced a stablecoin network, Société Générale plans a dollar‑backed token, and JPMorgan, Bank of America, Wells Fargo, and Citi are also exploring issuance. The milestone Genius Act, signed by President Trump, has cemented stablecoins’ legitimacy, with analysts projecting total circulation to surpass $1 trillion by 2028 despite banking lobby concerns over deposit flight.

Regulatory Compliance

🏛Nine leading European banks, including UniCredit and ING, have formed an alliance in the Netherlands to develop a euro‑backed stablecoin, slated for launch in the second half of 2026. The project will operate under the EU’s MiCA regulatory framework, with licensing overseen by the Dutch central bank. Positioned as a European alternative to U.S.‑dominated stablecoins, the initiative underscores Europe’s push for strategic autonomy in payments. Participating banks plan to offer added services such as wallets and custody, highlighting a broader bid to capture stablecoin market share and integrate crypto technology into Europe’s financial system.

🏛Singapore dollar stablecoin XSGD has been listed on Coinbase and will also launch on Base, the Ethereum Layer 2 network incubated by the exchange. Recognized by the Monetary Authority of Singapore under the upcoming single‑currency stablecoin framework, XSGD has already processed over 8.7 billion on‑chain transactions. The token is integrated with 120+ platforms and institutions, offering fee‑free SGD conversions and a new XSGD/USDC trading pair. Its listing signals growing support for non‑USD stablecoins on global exchanges and provides Singapore with a digital currency option that enables 24/7 settlement for cross‑border payments and FX.

🏛 The U.S. Commodity Futures Trading Commission (CFTC) has launched an initiative to allow stablecoins to be used as tokenized collateral for margin requirements in the vast derivatives market, seeking public input on its implementation. Acting Chair Caroline Pham, a long‑time advocate of stablecoin applications in collateral management, called the move a “killer use case” and announced a pilot for stablecoin‑backed tokenization. Written comments will be accepted until October 20, following the introduction of the GENIUS Act on stablecoin regulation. The effort, part of a “crypto sprint” with SEC Chair Paul Atkins, aligns with federal policy goals and could strengthen the role of stablecoins in institutional market infrastructure.

🏛SEC Chair Paul Atkins said in a Fox Business interview that he aims to implement an “innovation exemption” by the end of 2025, allowing crypto products to come to market more quickly. Since taking office in April, Atkins has pushed a friendlier stance toward digital assets, including launching Project Crypto to modernize the SEC’s rulebook. The SEC and CFTC will host a joint roundtable next week on bringing “novel and innovative products” back to U.S. markets, with Atkins stressing regulatory harmony over agency consolidation. His proposal comes as Congress finalizes crypto market structure legislation, signaling a clearer and more supportive environment for digital asset innovation.

🏛The White House plans to finalize a comprehensive crypto market structure bill by the end of 2025, according to Patrick Witt, executive director of the Digital Assets Advisory Council. The legislation will merge several proposals, including the CLARITY Act passed by the House in July and the Senate’s 2025 Responsible Financial Innovation Act, to clarify the respective authorities of the CFTC and SEC. Witt said the administration is working closely with both chambers of Congress and stressed that “the U.S. is open for crypto business, full speed ahead.” The initiative reflects the Trump administration’s shift toward regulatory certainty aimed at reversing the industry’s outflow abroad.