How Hedera HBAR Could Dominate Stablecoin Issuance AllinCrypto August 22, 2025
Stablecoin tokens have become critical components of the crypto asset industry. They bridge the gap between traditional finance and blockchain networks as tokenized fiat.
For years, Ethereum has been the primary network powering the largest stablecoins, including USDT and USDC. As institutional adoption grows, Ethereum’s limitations are becoming increasingly clear.
Hedera Hashgraph, with its unique architecture and recently launched Stablecoin Studio, is positioning itself as a leading contender to dominate the next phase of stablecoin issuance. Can Hedera pull off stablecoin domination?
Why Stablecoin Issuance Needs an Upgrade
The total stablecoin value of the market is now $267.14 billion as of August 22, 2025. Most stablecoin activity still takes place on Ethereum, where fees can spike during periods of high demand.
For institutions issuing stablecoins, these fees create a significant problem. Not only do firms face higher costs, but they must also contend with inconsistent speeds for settlements, which affect the promise of reliable and predictable digital payments.
As regulators and enterprises demand more robust infrastructure, Ethereum’s limitations are tested. With its Hashgraph consensus, predictable low fees, and governance from top organizations, Hedera Hashgraph can provide a stable foundation for the next wave of stablecoin adoption.
The Role of Hedera’s Stablecoin Studio
Hedera’s Stablecoin Studio is designed to make launching and managing stablecoins seamless for enterprises, banks, and firms. The studio includes all the necessary components to create a regulated digital token:
- Issuer controls to maintain compliance with KYC/AML regulations.
- Programmable treasury tools to handle issuance and redemption.
- Regulatory-friendly frameworks that appeal directly to banks and government agencies.
Unlike Ethereum, where stablecoin issuers must build much of their infrastructure independently, Hedera’s Stablecoin Studio provides an out-of-the-box solution.
Overall, this makes it easier for traditional institutions to enter the stablecoin market without needing to invest in specialized development.
Beating Ethereum on Cost and Performance
One of Hedera’s strongest advantages over Ethereum is its costs. Transactions on Hedera cost a fraction of a cent and remain predictable regardless of network activity. For stablecoin issuers, this ensures that minting, transferring, and redeeming tokens will never be overly expensive, even during periods of high demand.
Hedera’s consensus mechanism provides finality within seconds, allowing for real-time settlement. Ethereum transactions can face delays and require multiple confirmations to be considered truly final.
Such advantages make Hedera particularly attractive for cross-border payments and micropayments, where speed and low costs are essential.
The Future of Stablecoins on Hedera
Another critical factor working in Hedera’s favor is its governance model. The Hedera Council is composed of global organizations providing credibility and trust, assuring regulators and institutions that the network is being managed responsibly.
For stablecoin issuers, especially those operating in highly regulated environments, trust in the underlying infrastructure is essential.
The combination of Hedera’s Stablecoin Studio, institutional governance, and low-cost infrastructure creates a network that’s able to adapt and dominate stablecoin issuance in the coming years.
Several use cases further detail Hedera’s potential:
- Central Bank Digital Currencies (CBDCs): Governments looking to issue CBDCs can leverage Hedera’s ready-made infrastructure while retaining control over monetary policy.
- Tokenized funds on HBAR: Asset managers can issue tokenized versions of money market funds or treasury bills on Hedera. Lloyds Bank, working with Aberdeen and Archax, has already issued UK MMFs on HBAR.
Could Ethereum Lose Its Dominance?
Ethereum’s first-mover advantage has given the network a tighter grip on market dominance alongside its vast DeFi ecosystem.
Despite this, requirements for institutional stablecoin issuers differ from those of onchain DeFi projects. Scalability, predictability, and compliance matter more than speculative platforms.
USDC issuer Circle plans to launch the Circle Payments Network, hoping to become self-reliant when it comes to issuing USDC tokens and working with institions and banks, aiming to develop a super-fast network with low fees.
In such a competitive environment, Hedera may have an edge over Ethereum. The market can see that stablecoins are evolving from tokens used to withstand Bitcoin volatility and into critical infrastructure tokens for global finance, helping remedy US debt and expand US treasuries.
Ethereum may have laid the foundations, but its limitations are becoming its worst enemy in tokenization. Hedera Hashgraph, with its Stablecoin Studio, offers an enterprise-grade alternative.
The post How Hedera HBAR Could Dominate Stablecoin Issuance first appeared on AllinCrypto.
