00:00In five years or 10 years, the overwhelming majority of the payments that happen in the world just by sheer
00:06number of payments are happening via stable coins.
00:09It can be fundamental to changing not just the financial system, but the way the broader economic system works.
00:15And as of last year, the stable coin subset of crypto now has the regulatory backing of the U.S.
00:21This could be perhaps the greatest revolution in financial technology since the birth of the Internet itself.
00:28A lot of people are saying that. I don't know. What do you guys think? Yes.
00:31The answer to President Trump's question may lie in the wallets of people around the world who simply want to
00:37send money across national borders.
00:40According to Bloomberg Intelligence, the total amount of money sent using stable coins will reach over 56 trillion dollars by
00:472030.
00:48But however big it ultimately gets, it's starting small, with many people sending just a few hundred dollars at a
00:55time.
00:55People like Hannah Nicole Danoy.
00:58I have been living in New York for eight years and I am a restaurant manager.
01:02I send money home to the Philippines, I would say about like between five hundred dollars to a thousand dollars
01:08a month.
01:09I prefer sending money home through apps like World Remit or Remitly.
01:15Danoy is one of two million Filipinos living abroad.
01:18Together, they sent thirty five billion dollars back to the Philippines in 2025, equal to over seven percent of the
01:26country's GDP.
01:27For Wei Zhou, the CEO of Philippine based Coins PH, this is stable coins biggest opportunity.
01:34Ten years ago, the cost of remittance for every dollar, it was eight percent.
01:37With technology, with better connectivity and banking rails, that cost went down to like two to four percent.
01:43By using stable coins, we can lower that cost to anywhere between, you know, point five percent or 50 bips.
01:49And we hope to lower that even to like 20 to 30 bips.
01:51When you're running forty billion dollars remittance for every one percent that you save, you know, that's like four hundred
01:56million dollars that goes back into, you know, the people's pockets right away.
02:00Coins PH partners with online money transfer platforms to bring stable coins to users' wallets.
02:06It partners with, among others, Remitly.
02:08Its CEO is Sebastian Gunningham.
02:11Every time that you do a send transaction, we have a transaction engine that chooses the best way to send
02:18that money at low cost and at speed.
02:20So we use the stable coins rails.
02:23The machine decides, is the stable coin rails better, faster, cheaper than any alternative?
02:29And therefore we use it.
02:30So we're adopting it where it makes sense, where it beats price, where it beats speed.
02:37This process is called a stable coin sandwich.
02:41A user in the U.S. deposits dollars with Remitly, which converts the funds into stable coins.
02:46These stable coins travel instantly across a blockchain to Coins PH in the Philippines, where they are converted into local
02:53pesos.
02:54Although users can hold the stable coins in a digital wallet, for most, the blockchain path is entirely invisible.
03:01Customers interact only with the dollars at one end and the pesos at the other end, enjoying the speed of
03:07crypto without the complexity of managing it.
03:10We have crypto, we have stable coins.
03:12There's been a fair amount of volatility in cryptocurrencies.
03:14Does that affect stable coins?
03:16For stable coins, it is moving towards sort of, you know, just another word for money.
03:22Stable coins are a type of crypto, right?
03:25But it's sort of like it has grown out of crypto and can be its own segment now.
03:31What do you regard as your largest opportunity for growth?
03:34Basically lowering the transaction costs and then decreasing the transaction time to move money in and out of the Philippines.
03:41I think right now what we see is that there's like almost 15 to 20 million Filipinos that work overseas,
03:47either as domestic helpers, work on cruise liners, as factory workers in the Middle East and Korea and Japan.
03:53The financial services they need are actually back home in the Philippines, whereas they get paid in the local dollar.
03:59We really believe that by sort of using stable coins as sort of the conduit, we can actually be able
04:05to deliver financial services that they need at home here in the Philippines while working overseas.
04:11Last year, some estimates put the volume of stable coin transactions at around $35 trillion.
04:16But a new report from McKinsey's Matt Higginson suggests the reality is much more modest.
04:23How large is the stable coin market right now and how fast is it growing?
04:27So you'll hear in the media the trillions of dollars of stable coin payments today.
04:3399% of that is crypto related, not the sort of payments we think about, which is company to company
04:40or even paying remittances person to person.
04:43And so we look at this situation today and say, how much real payments volume is there out there?
04:48And we think it's probably the order of a billion or two a day, which is tiny.
04:53The latest estimates we have are $390 billion in the total year.
04:59And that compares with several trillion dollars of regular payments per day.
05:04So a small amount right now, how does it compare with last year and how does it compare with forecasts
05:10for next year?
05:10The data shows that the volume of real payment transactions using stable coins probably doubled over the last year.
05:18When you look at the volume of stable coins in circulation, that went from around $150 billion to $300 billion
05:25today.
05:26It's doubling, which by any measure is substantial in terms of growth.
05:30How much of that is cross-border international essentially?
05:34How much of it is domestic?
05:35The vast majority is cross-border.
05:37It's interesting, we've been looking at the geographic source of those payments with our research partner, Artemis Analytics.
05:45What they found is about 60% originates from Asia.
05:49And that surprised us a little bit because a lot of the talk has been in North America or Europe
05:53about the potential of stable coins.
05:56Asia was one of the first regions to recognize the utility of stable coins and became a front-runner in
06:02regulating the space.
06:03For over a decade, Sabnendu Mahante was the chief fintech officer at the Monetary Authority of Singapore, where he built
06:10the country's digital asset strategy.
06:12The single biggest unsolved challenge in the world of payment is the cross-border payments, where today we have to
06:19depend on traditional correspondent banks.
06:22In that particular use case, a stable coin is a great product.
06:27Singapore generally is recognized as a leader in the use of and regulation of stable coin.
06:34Why? Why Singapore?
06:36As a country, we look at options, innovation, and we actually relentlessly focus on use case.
06:44We don't do technology for sake of technology.
06:47In Singapore's case, our focus on stable coin has always been well-regulated stable coin, issued under a strong regulatory
06:55framework.
06:57Japan and Singapore were among the first to establish a framework requiring companies to maintain liquid reserves representing 100%
07:04of the stable coins they issued.
07:07Mahante says robust regulation must lead the way for stable coin to scale.
07:11The principle of regulation should not change because payment is a payment.
07:16Know your customer.
07:17Money laundering, terrorism, financing checks are, I would say, hygiennes.
07:22They are, like, non-negotiable.
07:23I personally believe an existing payment regulation with some incremental coverage for a stable coin's unique technical requirement is good
07:34enough to be consistent, good enough regulation to manage this risk.
07:38And payment companies agree.
07:41Regulatory clarity allows companies to bring the product to more customers.
07:45Scale matters, which means once you have the infrastructure, we can move $100 billion a year in that infrastructure, but
07:53we could also move $1 trillion a year without much more.
07:57Building trust is expensive.
07:59Doing compliance is expensive.
08:01Getting the license is expensive.
08:03Once you put all that in place, it's a highly scalable business.
08:07Today, stable coins are still small players against a colossal banking system, but they are gaining momentum, with growth expected
08:15to speed up as the Genius Act in the United States comes into effect.
08:19The Genius Act will come into force by the end of the year, and other regulations I expect will follow,
08:24so we haven't really gone live yet at scale.
08:28So I think we have a little time before that train leaves the station.
08:32The sobering part of that is when it does leave the station, we're going to have adoption at scale.
08:37We've got groups of banks, potentially dozens of banks, suddenly all participating together, and I think there will be a
08:44bit of a scramble to position myself as a bank between stable coin and customer to provide the best interface.
08:52What does your success potentially mean for traditional banks?
08:57There was one bank here in the Philippines that was like top 10, maybe like sixth or seventh, but because
09:02they were the only one or the first one to bank exchanges like ourselves,
09:06they're now a top three bank.
09:10Fast is nice, but when it comes to our money, there's also something to be said for slow.
09:15So stable coins is something I would be willing to try.
09:18It's just going to be a matter of convenience, and then I'm just not too educated about it.
09:22I would also consider if it's also going to be convenient with my family because they're not really tech savvy,
09:28so I want to make sure that it's going to be easy for them as well.
09:31Trusting an app is really important for me because it's my hard-earned money.
09:34The use of stable coin for cross-border transfers is more for small and medium-sized businesses rather than big
09:41businesses.
09:42Why don't the big businesses use it for that purpose?
09:45Well, I used to joke that if one thing you don't want to be instant and quick, it is large
09:51transfers.
09:51Because nobody is looking to instantly transfer $5 million.
09:56You want to be as slow as possible, as friction in between so that you don't make mistakes.
10:03But you don't want to apply those principles on a small $200 transfer across the border because you are taking
10:09a speed versus the amount calibrated risk here.
10:15I've been in crypto for about eight years, and then, you know, when I first came in, I was like,
10:19oh, like, let's go unbanked, you know, like, you know, let's take it to Wall Street.
10:24But now I've been in the industry for such a long time, I've come to appreciate the role that banks
10:28serve, right?
10:29Like, sometimes you just feel safer with your money in a bank, right, in a vault.
10:34And they've been attacked left, right, front and center by all kinds of, you know, bad actors.
10:38But I think for them to grow, you know, I think those that embrace this technology, embrace stablecoins, I think
10:45it's going to grow, leaps and downs faster than those that do not.
10:48Work with us and grow together, or you can, you know, continue just to be a bank.
10:54Technology might be driving us all toward a future that's faster, cheaper and more convenient.
10:59But it's not necessarily for everyone or for every transaction.
11:03And for stablecoins to reach their full potential, they may need more regulation, with the aim of fitting in to
11:10the legacy banking system rather than replacing it.
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