Stablecoin Payments Surge Past $400 Billion Driven by Corporate Adoption

Stablecoin payments have surged past the $400 billion mark this year, driven largely by corporate adoption. A report from Alvarez & Marsal (A&M) reveals that stablecoin payment volume from January to August 2023 reached $401 billion, a 42% increase compared to the same period last year. Despite accounting for just 0.5% of the $85 trillion in total stablecoin transfers, the growth trajectory remains steep.

Businesses are at the forefront of this shift, with 58-64% of payment volume involving transactions where a business was the final recipient. Business-to-business (B2B) fund transfers alone amounted to $137 billion to $153 billion, covering supplier payments, merchant settlements, and internal corporate fund movements. The use cases for stablecoins are diverse, with service fees leading at $56 billion, followed by payroll and compensation at $43 billion, and cross-border remittances at $37 billion.

Enterprise payment infrastructure providers are also benefiting from this trend. Request Finance and Deel, for example, enable businesses to settle invoices and pay overseas contractors in dollar-denominated stablecoins. Visa has seen a 200% year-over-year increase in stablecoin-linked card payment volume, with corporate cards accounting for 17% of this activity. Mark Nelsen, Visa's global head of commercial and money movement solutions product, noted that stablecoin usage is increasingly being discussed across various corporate activities.

While stablecoin payments have traditionally been more active in emerging markets, usage is now growing in high-income countries as well. The United States recorded $5.7 billion in volume, with South Korea, Australia, and Taiwan closely trailing emerging markets. However, blockchain transaction limitations make it difficult to determine the recipient country, with only 13.5% of total estimated payment volume having identifiable recipient countries.

Despite the growth, companies face hurdles in adopting stablecoin payments. Conversion times and fees, counterparty acceptance, and accounting system capabilities are significant barriers. Kim Min-seung, head of research at DigitalX, emphasized the need for expanded infrastructure for exchanging stablecoins and fiat currency, as well as clearer regulations and anti-money laundering standards to facilitate broader adoption.