Stablecoin Trust Layer: Infrastructure for Digital Dollar Adoption

Over the past year, the price of Bitcoin plummeted by over 50%, while the total crypto market cap lost more than $2 trillion. In contrast, the total supply of stablecoins remained relatively steady at around $290 billion.

This stability in stablecoin supply is a notable departure from previous crypto cycles, where the total supply of stablecoins typically fell alongside the broader market. However, this time around, use cases for stablecoins have expanded beyond just trading collateral to include store of value, cross-border remittances, B2B and B2C payments, and even as collateral for tokenized stocks and money market funds.

This increased usage has led to a higher level of risk in terms of illicit transactions and counterparties. The current norm of one-time KYC (Know Your Customer) procedures is no longer sufficient, as traditional KYC cannot see the entire lifecycle of a transaction.