Is the 'Stablecoin' the Real Winner After the Fed's Rate Cut? — Circle's IPO and the Realistic Solution for Cross-Border Payments_Last Week's Market Summary

The U.S. Federal Reserve (Fed) implemented a 0.25% rate cut on September 17 and signaled additional cuts within the year. As the macro environment reaches a turning point, the question of whether 'stablecoins can become the next payment infrastructure' has resurfaced. This article provides an overview of the movements of Circle (USDC), Tether (USDT), Visa/Mastercard, and Walmart/Amazon, and examines where the implementation opportunities and risks lie.

1. What is a stablecoin? — The design of 'price stability' and its current status

Stablecoins are crypto assets pegged to fiat currencies (mostly the U.S. dollar), aiming to serve as a foundation for remittances and payments based on price stability. While the total market supply has expanded to over 25 trillion yen, it remains orders of magnitude smaller than global M2 (approximately $96 trillion). While there is significant room for growth, full-scale penetration into the real economy is still ahead.

1-1. Current status of major use cases

The current main battlegrounds are (1) digital asset trading, (2) dollar-substitute holdings (dollarization), (3) yield utilization in DeFi, and (4) international remittances and cross-border payments. (4) in particular has significant potential to bypass and accelerate existing multi-stage relay processes, promising an impact in reducing exchange and settlement fees.

2. Circle (USDC) — Transparency through IPO and 'interest rate sensitivity'

Circle is set for an initial public offering on the NYSE in June 2025 (Ticker: CRCL, offering price $31). Its reserve assets are primarily short-term U.S. Treasuries, and the fact that it carries 'interest rate sensitivity'—where operating interest income diminishes during rate-cut cycles—is a common point of discussion for investors and business strategies. However, the enhanced disclosure accompanying the IPO, compliance with U.S. regulations, and the visibility of collateral through a dedicated fund formed with BlackRock have become differentiating factors.

3. Tether (USDT) — The trade-off between scale and trust

Tether is the largest issuer by market supply. BDO conducts quarterly attestations (confirmations based on audit reports), and the company publishes the breakdown of its reserve assets and excess reserves. However, there is constant debate regarding the 'granularity of disclosure and the resolution of asset composition,' and some still view it as a source of systemic risk for the industry. The fact that any instability in USDT could ripple out to the reputation of stablecoins as a whole is a structural risk.

4. Visa/Mastercard — 'Connection' rather than 'disruption' is the realistic solution

Over the past 20 years, emerging payment players have repeatedly claimed they would 'replace card networks,' but in reality, most have returned to 'coexistence and connection' in the face of comprehensive strengths such as network effects, fraud detection, chargebacks, merchant sales, and reward design. While the Fed's rate cut could be a tailwind for emerging players in terms of funding costs, significant added value is essential for consumers to switch from a 'zero-fee + high-reward' card experience.

5. In-house coin initiatives by major retailers (Walmart/Amazon) — The battle for control at the 'checkout counter'

Since the summer of 2025, there have been successive reports of Walmart and Amazon exploring the potential for their own stablecoins. If implemented, this could become a move to increase the stickiness of their in-platform economies, such as optimizing payment fees, integrating loyalty programs, and enabling instant settlement in cross-border marketplaces. It would be realistic to expand gradually from a 'closed-loop' limited to specific usage scenarios, while assuming partnership and coexistence with existing card networks.

6. Cross-border B2B and international remittances are the 'shortest route'

Cross-border B2B: A massive market estimated at approximately $88 trillion to $100 trillion as of 2024. Friction in reconciliation, foreign exchange, and settlement is significant, and if this can be bypassed via API, the benefits to businesses are clear.

International remittances: Global remittance flows are on an upward trend. Estimates for flows to LMICs (low- and middle-income countries) exceed $680 billion in 2024, making this an area with high social returns from lower fees and instant settlement. We expect implementation to proceed first from 'limited corridors x high-frequency use cases' where regulatory development is advancing (e.g., U.S.-Latin America, Japan-Southeast Asia).

7. 'Transparency x Regulatory Compliance x Corridor Strategy'

• Transparency of reserve assets: Frequency of attestations, auditors, and level of detail (maturity distribution, credit risk, segregated management of collateral).

• Regulatory compliance: Roadmap for obtaining licenses in the U.S., EU, and major corridors, and ability to respond to risk events.

• Corridor strategy: Phased expansion from high-friction B2B corridors and regions with high remittance costs (as seen in existing fintech moves to connect directly to networks).

• Connection with existing networks: Hybrid design with cards, payment gateways, and wallets ("complement" rather than "replace").

Conclusion — "The Next Payment" will proceed by sector

While the funding environment is easing due to the Fed's shift to easing, the core of consumer payments is heavily entrenched with network effects and reward economies, making a short-term "total replacement" unrealistic. The shortest implementation route is cross-border B2B and international remittances. The rational base case as of 2025 is a gradual scenario where players who establish a solid product-market fit here and build trust through regulatory compliance and transparency (such as Circle) expand their "connection points" with retail platforms (Walmart/Amazon) and card networks over the medium to long term.

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