By Chris Dixon, General Partner at a16z
Compiled by TechFlow
TechFlow Introduction: The internet globalized information, and cryptocurrency is having a similar effect on money. In this article, Chris Dixon, head of a16z Crypto, points out that stablecoins are having their "WhatsApp moment"—just as WhatsApp reduced the cost of cross-border messaging to zero, stablecoins are making cross-border payments nearly free and instantaneous. In 2024, stablecoin settlement volume is approaching that of Visa, and their position as a top-20 holder of U.S. Treasury bonds is invisibly strengthening the dollar's dominance in a multipolar world. This is not just an upgrade in payment technology but a profound restructuring of the global financial system.
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The internet globalized information. Crypto is doing the same for money. While recent headlines may still focus on the price of Bitcoin, a deeper, more enduring transformation is quietly underway in the realm of digital payments. This year, stablecoins (cryptocurrencies pegged to assets like the U.S. dollar) are officially going mainstream for online payments and international settlement.
We can call it money's "WhatsApp moment." Just as messaging apps like WhatsApp reduced the cost of international texts from 30 cents per message to zero, stablecoins are doing the same for financial transactions. The data proves it: After filtering out bots and non-genuine activity, stablecoin transaction volume last year exceeded $12 trillion—a scale approaching Visa's $17 trillion volume last year, but at a negligible cost.
In the process, stablecoins are bringing the original open and interoperable vision of the internet to finance. Given that blockchain technology makes stablecoins programmable, money is effectively becoming software.
While most stablecoin transactions today originate from "crypto-native" and global commerce rather than everyday consumer activity, this is changing. As more improvements aimed at reducing user friction come online, including integrations with more traditional finance (TradFi) partners, mass adoption will follow.
In the future, people around the world will engage in stablecoin-backed transactions almost without noticing they are using the technology. Most will think they are simply using U.S. dollars. And they will be right, because for the end user, the distinction between a stablecoin and a dollar is becoming abstract. Since each token is backed by one dollar or its equivalent in assets, the name doesn't matter. What matters is that the product is more reliable than any previous payment technology, and considering settlement is nearly instantaneous, it's effectively free and light-years ahead of existing technology.
Stablecoins also demonstrate the potential unleashed when policy and technology are in sync. Last year's *Genius Act* established clear U.S. rules for stablecoins. More crucially, Congress is now considering the *Clarity Act*, which would regulate the broader ecosystem of blockchain networks and digital assets underpinning stablecoins. The *Clarity Act* will help determine whether these networks will scale to become part of global financial infrastructure or stagnate. When you give challengers a level playing field and room to innovate, the market works its magic. This is how the web beat incumbents, how America dominated the internet, and how stablecoins will surpass today's payment structures.
Businesses are already recognizing the advantages of stablecoins. Some of the world's largest tech companies, banks, and retailers are launching plans to use stablecoins or, like Fidelity, have already issued their own. Payments giant Stripe, after acquiring several crypto companies over the past year or so, now supports stablecoins at checkout, instantly reducing payment processing fees from about 3% to 1.5%, with plenty of room to fall further. SpaceX uses stablecoins to move funds out of places like Argentina and Nigeria, where local banking systems are fragile or capital controls are strict. Some companies use stablecoins to pay global employees faster. Ultimately, the internet could transform into a thriving, open marketplace of machine-to-machine commerce, where AI agents represent users in real-time deal-making and contract settlement.
The proliferation of stablecoins also has an often-underestimated second-order effect: these tokens reinforce the dollar's dominance in a multipolar world, creating a powerful new source of demand for U.S. Treasury debt. Leading stablecoin issuers like Circle and Tether now directly hold nearly $140 billion in short-term U.S. government debt, placing them among the top 20 holders of U.S. Treasuries today. If stablecoin adoption continues at its current growth rate, they will jump into the top 10 by next year. (Citigroup Research even envisions a scenario where stablecoins could hold the top share of U.S. Treasuries relative to foreign governments and commercial banks by 2030.)
This is not just about payments. This is a reorganization of global finance. The internet gave us borderless communication; stablecoins give us borderless value transfer. With clear rules and market structure, they can become the pipes and pillars of a new financial system.
