Circle: Not all companies can issue stablecoins

Original Title: The Stablecoin Trap: Issuing a Stablecoin Without the Infrastructure to Run One
Original Author: Kash Razzaghi, Circle
Translation by: Peggy, BlockBeats

Editor’s Note: As regulatory clarity and institutional participation increase, stablecoins are evolving from technical tools to critical financial infrastructure. This article points out that issuing a stablecoin is not merely a technical choice but a long-term strategy concerning trust, liquidity, and compliance capabilities. Most projects stop short of scaling, and the market is naturally converging on a few mature networks. For most businesses, the real question is not "whether to issue a coin," but "how to effectively use stablecoins" to create growth opportunities.

Here is the original text:

In recent months, I have repeatedly engaged in familiar conversations with executives from some of the world’s largest companies. They have shown a keen interest in stablecoins that can circulate almost instantly and cross-border, such as USDC and EURC, the digital versions of the US dollar and euro. Many of them are also pondering: should we issue our own stablecoin?

This impulse is understandable. The market has already achieved real scale and sustained growth momentum. By January 1, 2025, the total market capitalization of stablecoins is projected to grow from approximately $205 billion to over $300 billion by December 31, 2025. USDC, issued by Circle, remains one of the core assets in this category, closing out 2025 with a market cap exceeding $75 billion.

However, before truly entering the market, every company should first ask itself a question: do you simply want to use stablecoins for your business, or do you intend to genuinely enter the "stablecoin issuance" business?

This is not a technical issue but a strategic one: does issuing currency belong to the core of your business model?

Relatively speaking, creating a stablecoin on the blockchain is actually the easiest part. Essentially, it is just a software engineering practice: writing and deploying a blockchain-based token contract. As long as there is an engineering team, or in some cases with the help of white-label partners, a token can go live in a relatively short time. But once the product is officially operational, running a stablecoin means supporting a year-round financial infrastructure.

To operate a trustworthy, regulated stablecoin—one that can meet the expectations of institutions, regulators, and millions of users—real-time reserve management across different market cycles is essential, along with daily reconciliations with multiple banking partners, acceptance of independent audits, and compliance and regulatory reporting across multiple jurisdictions. This means building a compliance, risk management, fund management, and liquidity operation system that runs around the clock, with clear escalation and resolution mechanisms under pressure and zero tolerance for errors. These capabilities are not something that can be "outsourced once and forgotten"; as scale increases, they will continuously accumulate and amplify in cost, complexity, and reputational risk.

From a systemic perspective, every new, closed-loop proprietary stablecoin further fragments liquidity and trust. Each issuer is redundantly building reserves, compliance systems, and redemption channels, which undermines the overall depth and resilience that stablecoins rely on during times of stress. In contrast, accessing USDC can integrate liquidity, standards, and operational capabilities into a widely adopted unified network from day one.

For executives evaluating this decision, the differences between these two paths will become particularly clear when viewed from an operational perspective:

The Temptation of Shortcuts

Currently, a wave of new entrants, from fintech companies and payment institutions to crypto projects, are exploring or directly launching their own stablecoins. The growth of the stablecoin market in 2025 reflects both the gradual clarity of the regulatory environment and the rising interest from institutions. However, the reality is that despite hundreds of stablecoin projects being launched, about 95% have never truly achieved lasting, global scale.

Some believe that it is possible to replicate the same economic returns without bearing heavy operational costs. The reality, however, is not romantic. Whether issuing independently or through white-label services, you are entering an industry where trust, liquidity, and scale are lifelines.

Sometimes, the cost of mistakes can even be measured in "trillions." According to media reports earlier this year, a certain issuer accidentally minted $300 trillion worth of tokens due to an operational error. Although it was fixed within minutes, it was enough to make headlines. In another instance, a well-known stablecoin briefly lost its peg during a market volatility, once again illustrating that even small infrastructure flaws can be amplified and transmitted under pressure.

These events remind us that whether a stablecoin can stand firm depends on the rigor of its operations under high-pressure environments. The market and policymakers are closely watching.

Trust is the True Network Effect

Anyone can create a token on the blockchain. In fact, there are already thousands of them—most minted in minutes and just as quickly forgotten. Even within the stablecoin niche, over 300 projects have been launched, but only a very few carry almost all of the real usage and value; the vast majority, about 95%, have never truly succeeded.

The difference lies not in technology but in scale and trust. The real challenge for stablecoins begins at the expansion stage: as transaction volumes grow across different markets and cycles, how to continuously maintain liquidity, redemption capability, compliance, and system availability.

You can mint a token in minutes, but you cannot mint trust in minutes. Trust comes from transparency, scale, and consistent redeemability across market cycles, accumulating over time. This is precisely why the stablecoin market ultimately concentrates in the hands of a few issuers—also why, as of January 30, 2026, USDC's historical cumulative settlement volume has exceeded $60 trillion.

Instead of Reinventing the Wheel, Choose Collaboration

For most businesses, the right question is not "how should we issue our own stablecoin?" but "how can we integrate stablecoins into our business to unlock new growth?"

With USDC and EURC, businesses can today embed digital dollars and euros, gaining near-instant settlement, global coverage, and interoperability across dozens of blockchains, without having to bear the complexities of reserve management and regulatory compliance themselves.

Co-authoring the Next Chapter

The stablecoin industry is entering a new phase. Policymakers are establishing clearer rules, institutions are raising their standards, and the market is gradually converging on a simple consensus: trust, liquidity, and compliance are the true moats.

The goal is not to have more stablecoins but to have fewer but better stablecoins—those that can respond to current demands with shared liquidity, transparent reserves, and proven performance across cycles.

For institutions developing stablecoin strategies, the first step should not be to decide "what to create," but to decide "who to create it with." If you want stablecoins to empower your business but do not wish to become a stablecoin issuer yourself, the time-tested choice is clear: talk to Circle and use USDC.