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The $230 billion stablecoin industry stands at a crossroads. With the Trump administration pushing to make the US the ‘crypto capital of the planet,’ racing to bring stablecoins to the masses, regulatory clarity appears imminent but the real question is whether this political momentum will elevate stablecoins as transformative financial infrastructure or merely solidify them as casino chips for traders in a speculative market.
The paradox of today’s stablecoins
Stablecoins were meant to bridge crypto and TradFi (traditional finance), yet they remain largely confined to intra-crypto trading.
They were originally envisioned as frictionless, programmable dollars that could flow across the globe in seconds.
Yet, in practice, they have largely been used to arbitrage, speculate and navigate exchange inefficiencies.
High-profile failures like TerraUSD’s algorithmic collapse, depegging events from USDC and Tether and ongoing concerns over opaque reserves expose a paradox that today’s stablecoins mimic the structural fragilities of the very financial systems they were meant to disrupt.
While fiat-backed models may command the security of treasuries or bank deposits, they introduce counterparty risk, being repackaged under the label of innovation.
In effect, most stablecoins don’t remove risk but rebrand it.
Political opportunism
The push for a stablecoin bill by August 2025 by Trump could bring much-needed legal certainty.
But if legislation is shaped by industry lobbying and political self-interest, such as the Trump-linked stablecoin venture being formed, it risks enabling another cycle of light-touch regulation and insider enrichment.
The Terra disaster proved that without robust safeguards, stablecoins remain a ticking time bomb.
Could this open the door to regulatory arbitrage, where rules are written to favor a few powerful players while smaller or more ethical projects are sidelined?
Addressing the lip service
A common talking point in crypto circles is that stablecoins can ‘bank the unbanked.’
Yet, to date, access to stablecoins often requires an existing relationship with crypto exchanges, fiat on-ramps and a level of digital literacy far beyond the reach of the underserved.
In practice, they serve the overbanked: traders, institutions and whales.
True financial inclusion requires the right infrastructure, like AI-powered wallets that automate hedging, not just dollar-pegged tokens.
Stablecoins as a new form of value
With a lack of clear reserve requirements or public audits, and an unclear path to adoption for those most in need, it’s important to ask whether the US should prop up legacy models or incentivize stablecoins that actually power the next economy.
The future lies in stablecoins that are intelligent, AI-backed, transparent and tied to real productive assets like AI compute power, tokenized research and development or DeFi lending markets.
To achieve this, policymakers must mandate real-time, on-chain PoRs (proof of reserves) as opposed to self-reported audits, reward stablecoins that enable real-world use cases (payments, AI services, DeFi) over pure speculation and promote overcollateralized models that eliminate single points of failure.
The Trump administration’s crypto push is neither inherently good nor bad. It’s a test of whether the industry can mature beyond short-term profiteering.
Stablecoins won’t revolutionize finance by mimicking dollars but by creating new forms of value.
We shouldn’t be asking if Trump’s policies will give stablecoins a boost.
We should start analyzing whether builders and regulators will demand a system that’s transparent, resilient and truly innovative.
Ian Estrada is advancing the development of DefAI infrastructure as a CEO of Maitrix, creating the DeFi layer for AI tokens. Product builder by trade, memecoin and stablecoin enjoyer by passion. Former vice president at GCash (over 100 million users), more than 10 years product experience in payments, lending and credit risk. Crypto since 2020.
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