Stablecoins are no longer just a crypto-native experiment—they're evolving into a foundational layer of the global financial system. With regulatory frameworks like Hong Kong’s Stablecoin Ordinance and the U.S. GENIUS Act shaping a new compliance era, the path to mass adoption is becoming clearer. As giants like Circle achieve public market success and Web2 titans such as Walmart and JD.com signal interest, stablecoins are entering a pivotal growth phase.
At the heart of this transformation lies infrastructure—secure, compliant, and scalable. Cobo, a full-service digital asset custody and wallet platform, has positioned itself at the intersection of technology, regulation, and distribution. In this deep dive, we explore insights from Alex Zuo, Cobo’s Senior Vice President and Head of Payments, on how stablecoins can achieve real-world scale—and what it takes to build the future “internet money layer.”
The Infrastructure Imperative: Why Wallets Matter More Than Ever
While much attention focuses on stablecoin issuance, Alex emphasizes that wallet infrastructure is the missing piece for widespread adoption.
"Many companies realize too late that their wallet capabilities are underdeveloped. It’s not just about holding assets—it’s about enabling seamless, secure, and compliant transactions across borders and platforms."
Cobo’s approach is rooted in years of building robust custodial solutions for exchanges, mining firms, and institutional clients. But as demand shifts toward cross-border payments and stablecoin circulation, Cobo has evolved its offerings to meet the needs of non-crypto-native enterprises.
These businesses often lack deep blockchain expertise but require high levels of security, scalability, and regulatory alignment. To bridge this gap, Cobo introduced chain abstraction—a technical layer that hides blockchain complexity from end users.
👉 Discover how next-gen wallet infrastructure is lowering barriers to crypto adoption.
For example, instead of requiring users to manage gas fees or understand private keys, Cobo enables USDT-based transfers denominated in fiat terms (e.g., “Send $100”), automatically handling gas in the background. This dramatically lowers the learning curve for traditional finance teams adopting stablecoins.
Three Pillars of Success: Technology, Compliance, and Distribution
According to Alex, stablecoin success hinges on three interdependent factors: technological sophistication, regulatory readiness, and effective distribution.
1. Technology: Bridging Web2 and Web3
Modern stablecoin applications must feel native to both crypto experts and corporate treasurers. Cobo supports multiple wallet architectures—including MPC (Multi-Party Computation) self-custody and centralized托管—giving clients flexibility based on their risk appetite and compliance goals.
MPC wallets are increasingly favored because they allow institutions to maintain control over assets while still meeting audit requirements. However, managing MPC keys securely remains a challenge—especially for companies without dedicated crypto teams.
Cobo’s dual-model approach allows clients using MPC to benefit from Cobo’s centralized compliance stack, including real-time transaction monitoring and anti-money laundering (AML) screening.
"We’re the only company globally offering both centralized custody and MPC self-custody at scale. This hybrid model gives clients the best of both worlds: control and compliance."
2. Compliance: The License-to-Operate Factor
Regulatory scrutiny is intensifying worldwide—from MiCA in Europe to VARA in Dubai and Hong Kong’s emerging stablecoin licensing regime. Simply put: no compliance, no market access.
Cobo holds licenses in key jurisdictions, including Hong Kong, where it operates a trust account authorized for digital asset custody. This allows clients to integrate with compliant banking partners through Cobo’s network—bypassing one of the biggest hurdles in crypto finance: bank onboarding.
For companies pursuing their own licenses (e.g., under Hong Kong’s new stablecoin rules), Cobo provides end-to-end support—from technical integration to audit coordination with Big Four firms.
"We’ve worked with Nasdaq-listed mining companies and港股 firms on crypto audits. We know what regulators expect—and we help clients meet those standards from day one."
3. Distribution: Building Real-World Use Cases
Even the most technically sound stablecoin fails without circulation. That’s where Cobo’s PSP (Payment Service Provider) network becomes critical.
With an annual transaction volume approaching $3–4 trillion, Cobo connects stablecoin issuers with thousands of merchants, OTC desks, exchanges, and payment processors. This ecosystem functions as a multi-layered distribution engine:
- Core Layer: Large PSPs, exchanges, and market makers linked via fast-settlement rails.
- Middle Layer: Regional payment providers using Cobo’s APIs for minting/burning and compliance.
- Edge Layer: End merchants and retail users accessing stablecoins through simplified wallets.
This structure mirrors CeDeFi (Centralized-Decentralized Finance) principles—filtering participants through trusted custodians while enabling efficient peer-to-peer value transfer.
"If you’re issuing a stablecoin with $1B in supply but only circulating $50M, you’re not capturing value. Our network helps issuers unlock liquidity by connecting them directly to active transaction flows."
Overcoming Barriers: The Cross-Disciplinary Challenge
Despite growing momentum, Alex warns that few teams possess the full skill set needed for stablecoin success.
"You need deep expertise in three domains: finance (Fin), technology (Tech), and crypto-native operations (Crypto). Most companies excel in one or two—but rarely all three."
- Finance: Requires understanding capital reserves, banking relationships, KYB/KYC frameworks, and audit trails.
- Technology: Involves building secure smart contracts, integrating with payment rails, and abstracting blockchain complexity.
- Crypto: Demands knowledge of on-chain mechanics—minting/burning, liquidity provisioning, MEV protection, and DeFi composability.
The absence of any pillar creates vulnerabilities—whether regulatory missteps, technical exploits, or poor user adoption.
Market Outlook: Where Will Stablecoins Thrive?
When asked which regions offer the most fertile ground for stablecoin growth, Alex highlights a nuanced landscape:
- Singapore: Early mover with clear legislation but lingering ambiguities in enforcement.
- Switzerland: Crypto Valley offers strong legal clarity and banking access—despite European reserve risks.
- Dubai: Regulatory openness is appealing, though limited global banking recognition remains a bottleneck.
- Hong Kong: High prestige but strict licensing caps; only a handful of applicants will succeed.
- United States: Low issuance barriers but high demands on banking partners (e.g., Fed membership).
His advice? Pursue a multi-jurisdictional strategy—especially if your use case spans continents.
FAQ: Addressing Key Questions About Stablecoin Adoption
Q: Can small players compete in the stablecoin space?
A: Direct issuance is dominated by large institutions due to capital and regulatory costs. However, entrepreneurs can thrive by building tools around compliance automation, cross-chain swaps, or credit-enabled payment rails.
Q: Is wallet infrastructure really that important?
A: Absolutely. Without secure, user-friendly wallets integrated into business workflows, stablecoins remain siloed. Stripe’s acquisition of Privy signals that even tech giants see wallets as core to future payments.
Q: What’s the biggest misconception about stablecoins?
A: That they’re only useful for speculation or remittances. In reality, they’re becoming operational currencies—for payroll, supply chain finance, and automated B2B settlements.
Q: Will AI agents drive stablecoin usage?
A: Potentially. If millions of AI-driven services begin transacting autonomously, stablecoins offer the ideal medium: programmable, fast, low-cost, and globally accessible.
Q: How does Cobo ensure funds aren’t linked to illicit activity?
A: Through real-time chain analysis tools and integration with leading AML providers. All transactions undergo screening before settlement.
Q: Are traditional banks obsolete in a stablecoin world?
A: Not obsolete—but their role will shift. Banks will likely serve as regulated entry/exit ramps rather than primary custodians or payment processors.
The Road Ahead: Stablecoins as Internet Money
Alex envisions a future where stablecoins form an invisible yet essential “internet money layer”—powering everything from e-commerce to AI-driven economies.
"Just as HTTP standardized data transfer, stablecoins could standardize value transfer. And just as browsers made the web accessible, wallets will make crypto usable for everyone."
Cobo’s mission is to be the bridge between legacy finance and this new paradigm—not by replacing banks or exchanges, but by empowering them with secure, compliant infrastructure.
As more corporations adopt crypto reserves—or explore issuing their own tokens—the need for trusted custodians with global reach will only grow.
Final Thoughts: A Turning Point for Financial Infrastructure
We are at a critical inflection point. The convergence of regulatory clarity, institutional demand, and technological maturity makes 2025 a defining year for stablecoin adoption.
While challenges remain—especially around interoperability, privacy-preserving compliance, and cross-border legal alignment—the momentum is undeniable.
For builders and businesses alike, the message is clear:
The future of money is digital. The medium is stablecoins. The infrastructure is being built today.
And for those positioned at the foundation—like Cobo—the opportunity isn’t just about market share. It’s about shaping how value moves in the next era of the internet.
Core Keywords: stablecoin adoption, crypto wallet infrastructure, cross-border payments, MPC custody, CeDeFi, regulatory compliance, blockchain technology