Why Stablecoins Are Becoming the Hottest Bet in Crypto VC Circles

What was once viewed as a utility layer is now emerging as a trillion-dollar opportunity. VCs are betting big, not just because the tech works, but because the numbers are finally starting to make sense.

The turning point came when Stripe acquired Bridge for $1.1 billion in October, the largest crypto M&A deal ever recorded. That move sent a clear message: stablecoins aren’t just hype, they’re going into real production.

Stripe processes about $1 trillion in total payment volume, and if they manage to shift even a portion of that onto a proprietary stablecoin platform, they could unlock a net interest margin windfall of roughly $40 billion a year, assuming treasury yields remain near 4%. That scale of upside has made investors sit up and pay attention.

According to Stefan Cohen from Bain Capital Crypto, we’re still in the early stages. He pointed out that annual stablecoin settlement volumes have already crossed $10 trillion. The potential isn't just within the crypto bubble, it extends into global finance.

What sets this wave apart is the scale. Stablecoins are gaining traction outside of crypto trading. Supply has jumped from $125 billion at the beginning of 2024 to almost $230 billion now an 84% leap.

Cross-border payments using stablecoins have surged, now hitting as much as $50 billion per month. Rob Hadick of Dragonfly said this growth, which comes from non-trading activity, proves stablecoins are beginning to integrate into the real economy.

Follow the Money VCs aren’t just excited about adoption, they’re excited about profits. Top issuers like Tether are generating billions from treasury yield revenues while operating with lean teams and minimal expenses. Stefan Cohen summed it up simply: "Stablecoins are inherently a very profitable business."

That profitability is catching the eye of fintechs, banks, and startups alike. Hadick noted that virtually every financial services or fintech company now has a stablecoin strategy. But the opportunity isn’t just in issuing coins. Infrastructure providers, those building wallets, blockchains, payment rails, and compliance tools, are attracting VC capital too.

Some investors are focused on app-first models, where stablecoins aren’t the main product but are used in the background to enable new monetization strategies. Cohen explained that the most valuable businesses in this space will either build scalable, permissionless infrastructure or user-facing apps where stablecoins are seamlessly integrated into existing services.

Regulatory Pressure and Promise However, all this momentum hinges on regulatory clarity. For VCs, regulation is both the greatest catalyst and the greatest risk. Many agree that a clear U.S. framework would open the door for banks, fintechs, and enterprises to dive in.

David Pakman of CoinFund believes that once stablecoin regulation becomes law, supply and transaction volume could jump fivefold in a short time. Lopez of VanEck Ventures suggested that the industry could scale as rapidly as cloud computing once a regulatory green light is given. Businesses that don’t move quickly, he warned, risk being left behind.

Still, not everyone is optimistic about how inclusive the rules might be. Jed Breed of Breed VC warned that if regulations only allow large institutions to issue stablecoins, it could strangle innovation. He emphasized the need for rules that give smaller players a fair shot.

Hadick pointed to growing concerns that banks and entrenched interests are already shaping bills and systems in ways that restrict access. He said much of the adoption seen from major banks like JPMorgan is happening in closed ecosystems that limit broader participation. The fear is that regulation could entrench incumbents and freeze out innovation.

The Long Game Ultimately, VCs aren’t just betting that stablecoins will continue growing, they’re betting that stablecoins will become the default rails for moving value online. The infrastructure is being laid down, regulation is inching forward, and real-world demand is already apparent.

As Hadick put it, stablecoins might not be perfect for every financial use case, but they’re increasingly better than legacy options. And they’re going to keep getting better.

A Record-Breaking Year in the Making 2024 was already a banner year for stablecoins, with more than $5.5 trillion in adjusted volume processed across 1.2 billion transactions, according to Visa’s onchain dashboard.

The pace hasn’t slowed. In just the first few months of 2025, stablecoins have already surpassed $2 trillion in adjusted volume, spread across 300 million transactions. If this momentum holds, we could see the $6 trillion mark broken before the year is over.

Visa’s data filters out bot activity and exchange rebalancing to reflect genuine economic usage. And the message is clear: stablecoins aren’t fading into the background. They’re becoming the norm.