Stablecoin Payments Accelerate as Banks and Card Networks Jockey for Position

Slow Supply, Fast Payments: The Paradox

Stablecoins are seeing a surge in usage for payments even as their overall supply stagnates. In the first nine months of 2026, stablecoin payments reached $482 billion—a 45% increase from the prior year—while the total value of stablecoins in circulation ticked up just 0.4% to $305 billion by September, according to coindesk.com. This divergence between transaction volume and supply growth highlights a market where adoption is outpacing new issuance.

The number of stablecoin transactions also jumped sharply, with over 1 billion payments recorded in the same period—a 71% rise year-on-year. Yet despite this activity, the headline number of circulating tokens barely budged, suggesting that users are moving existing coins more efficiently rather than bringing large amounts of new capital into the ecosystem.

Small purchases under $50 accounted for 84% of the increase in stablecoin card transactions during 2026.

Card Giants Bet Big on Stablecoins

Major payment networks are accelerating their integration of stablecoins into mainstream finance. Mastercard launched its Global Money Platform in partnership with BVNK, allowing users to hold traditional currency and stablecoin balances side-by-side, convert between them, spend via card, and receive payouts to bank accounts. Early adopters like Nuvei and Marqeta are already plugging into this infrastructure.

Stripe is also expanding its reach by working with Plasma XPL$0.07875 on cards that support both fiat and eligible stablecoin balances across more than 30 countries, with plans to cross the 100-country mark next year. Visa has announced it will integrate stablecoins into international payment funding flows, further blurring the line between crypto assets and traditional financial rails.

Allium’s data shows stablecoin-linked card spending hit $3.9 billion through September 2026—ten times higher than a year earlier—with most of this growth coming from small purchases under $50. This signals that everyday spending, not just large transfers or speculative trading, is now a primary use case for stablecoins via cards.

Banks Eye Stablecoin Threat, Respond

Traditional banks are taking note of stablecoins’ growing appeal—especially as they risk losing deposits to digital alternatives promising higher returns or faster access. A Bank for International Settlements (BIS) study found that even a one-week increase of just one basis point (0.01 percentage points) in average bank deposit rates could slow ten-week stablecoin market cap growth from about 15% to roughly 12%. Using another method, the effect could be even larger, potentially cutting growth to around 6%, though researchers caution about methodological limits.

Bank of America CEO Brian Moynihan warned earlier this year that as much as $6 trillion in deposits could migrate toward stablecoins and related products offering yields.

Despite these concerns, it remains uncertain whether rising rates will meaningfully reverse the trend or simply change how banks fund themselves; Federal Reserve staff have noted that money placed in stablecoins often returns to banks as issuer deposits.

Stablecoins Tap Global Remittance Market

Remittances are a major area where stablecoins offer tangible savings over legacy systems. Sending a $200 remittance using stablecoin rails costs a median fee of just 1% ($2), compared with 6.36% ($12.72) for traditional providers, based on Q3 data from Borderless.xyz and World Bank figures for Q3 2025. The cost advantage is even starker in regions like Sub-Saharan Africa—where stablecoin-powered transfers average 2.9%, versus 8.46% for conventional methods—and Latin America (1.25% vs. 5.64%).

For businesses making larger payments, the difference is equally significant: sending $10,000 in stablecoins to the eurozone can cost as little as $26 at the lowest-cost provider, while a comparable international bank wire ranges from $135 to $150 once transfer fees and foreign-exchange margins are included.

Speed is another differentiator: median settlement times for stablecoin payouts were two minutes via Brazil’s PIX network and three minutes via Mexico’s SPEI network in Q3, while SWIFT-based international wires typically take at least one business day—and sometimes up to three days for slower cases.

USDC Overtakes USDT in Transaction Share

Competition among issuers is shifting as well. Circle’s USDC has surpassed Tether’s USDT by share of adjusted transaction volume so far in 2026—rising from about 40% last year to over 60%, even though USDT still leads by market cap at $183.4 billion versus USDC’s $72.5 billion late last week.

Circle is aggressively targeting expansion into developing markets—about 40 new countries across Southeast Asia, Latin America, Africa, and the Middle East—responding to rising demand for dollar-backed digital assets outside traditional banking channels.

The company also agreed in September to acquire Singapore-based Tazapay in a $400 million all-stock deal expected to close next year, signaling further moves into global payments infrastructure.

Micro-Trends Complicate Growth Narrative

While payment volumes and card usage have soared—especially for small-value transactions—the overall supply of stablecoins remains nearly flat since January. This tension between rapid adoption at the user level and sluggish aggregate growth suggests that competition from rising bank deposit rates may be having an impact on how much new money flows into these assets.

It’s unclear whether regulatory clarity or further integration with mainstream financial players will unlock another wave of supply expansion—or if banks’ countermeasures will keep growth contained despite surging demand for low-cost cross-border payments.

What may drive the next phase

If banks raise deposit rates by even one basis point in a given week, the BIS paper finds that stablecoin market capitalization growth could slow from about 15% to 12% over the following ten weeks, with a potentially larger effect under alternative estimates, though the precise impact remains uncertain.