By: Vladimir Jovanovic, Vice President of Innovation, Velera
Summary: In the U.S., the GENIUS Act has been signed into law, laying the groundwork for a federal 
framework that could legitimize stablecoins and accelerate their adoption. In this blog post, Vladimir Jovanovic, Velera’s vice president of Innovation, discusses how this evolution presents credit unions with a timely opportunity to evaluate their role in the changing payments landscape – and consider how strategic partnerships might help them remain competitive and relevant in the future.
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The world of digital assets is evolving quickly, and one of the most significant developments reshaping modern finance is the rise of stablecoins. Once niche tools for cryptocurrency trading, stablecoins are now a central component of broader discussions around the future of money and being evaluated – and in some cases adopted – by major financial institutions, fintech companies and mega retailers.
As of mid-2025, stablecoins are on their way to becoming part of the global financial infrastructure. This evolution presents credit unions with a timely opportunity to evaluate their role in the changing payments landscape and to consider how strategic partnerships and innovation might help them remain competitive and relevant in the future.
What are Stablecoins?
Stablecoins are digital tokens designed to maintain a stable value by being pegged to traditional fiat currencies like the U.S. dollar. They act like digital cash, offering the speed and reach of crypto without the volatility.
Most fall into three categories:
- Fiat-backed stablecoins, such as USD Coin (USDC) and Tether (USDT), are backed 1:1 by reserves like U.S. dollars held in regulated financial institutions.
- Crypto-backed stablecoins, like DAI, are collateralized with digital assets, often overcollateralized to mitigate price fluctuations.
- Algorithmic stablecoins, which attempt to maintain price stability through smart contract-based supply adjustments, have largely fallen out of favor due to their instability and regulatory scrutiny.
The Stablecoin Market in 2025
The global stablecoin market exceeds $250 billion, boosted by favorable policy momentum. In the U.S., the GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act) has been signed into law, laying the groundwork for a federal framework for payment stablecoins that could legitimize and accelerate adoption.
USDT continues to lead the market in volume, especially on crypto exchanges, while USDC has distinguished itself through regulatory compliance and adoption among financial institutions. Meanwhile, PayPal’s PYUSD is gaining traction in consumer-forward apps like Venmo, signaling increasing mainstream use.
Other market entrants include First Digital USD (FDUSD), popular in Asia-Pacific markets, and FIUSD, a stablecoin launched by Fiserv in partnership with Circle and Paxos. Fiserv plans to embed FIUSD into platforms like Finxact and Clover, offering its clients a pathway to participate in the evolving digital asset economy without the need for major new technical investments.
Stablecoins are now used not just for crypto trading but for a wide range of financial activities – from cross-border remittances and securities settlement to e-commerce and even decentralized finance (DeFi) applications. Their appeal lies in fast, low-cost and programmable transactions with high interoperability.
The GENIUS Act: Regulatory Clarity for Stablecoins
The GENIUS Act is the most comprehensive federal stablecoin regulation to date. It mandates 1:1 reserve backing, real-time auditability and regulatory oversight. Importantly, the bill allows non-banks, including fintech companies, to issue payment stablecoins under limited-purpose charters. It restricts the use of unbacked or algorithmic stablecoins in payment systems and encourages financial inclusion by aiming to lower remittance costs and provide digital access to the unbanked.
With the act passing into law, this could catalyze market adoption by providing legal clarity, sparking infrastructure investments and encouraging wallet providers to design for cross-platform interoperability.
What Major Players are Doing
Stablecoins are no longer a fringe technology. Global banks are piloting and launching stablecoin-powered products at scale:
- JPMorgan’s JPM Coin facilitates institutional payments and liquidity management on its Onyx platform.
- Citibank and Goldman Sachs are exploring tokenized deposits and stablecoin-based treasury tools.
- HSBC and BNY Mellon are building custody and internal settlement frameworks using stablecoins or tokenized cash equivalents.
Walmart, through its fintech arm Hazel by One, is exploring a proprietary stablecoin for in-store and online payments. This could reduce its reliance on card networks and lower merchant processing fees.
Meanwhile, Amazon has filed patents related to blockchain payments and is rumored to be developing internal payment infrastructure powered by digital tokens. This could streamline seller payouts and transform e-commerce checkout experiences.
PayPal remains the most visible tech player. Since launching PYUSD in 2023, it has integrated the stablecoin into PayPal and Venmo, allowing users to send, receive, convert and transfer it to external Ethereum wallets. The company plans to tie PYUSD into merchant settlements, loyalty programs and broader ecosystem functions.
What’s in it for Credit Unions?
Stablecoins present a powerful opportunity for credit unions – and not just a competitive threat. These institutions could serve as trusted on-ramps and off-ramps between fiat and digital dollars. Another opportunity could be integrating stablecoin payment infrastructure, especially for cross-border transactions, whereby credit unions could offer members faster, cheaper alternatives to traditional wire transfers.
They could also partner with fintechs to offer custody and wallet services for interested members. As infrastructure matures, credit unions might even participate in interbank settlements using stablecoins to improve liquidity and reduce reliance on slower, more expensive systems. The GENIUS Act could make such participation more accessible by offering clear guidelines and regulatory protection for financial institutions that wish to engage.
Of course, credit unions will need to proceed with caution and information. Regulatory compliance, cybersecurity and technological readiness – as well as staying informed of any shifts – are essential. Many core banking systems aren’t yet blockchain-compatible, so credit unions will need robust API integrations and due diligence frameworks before engaging stablecoin providers.
Member education is another critical element. Most consumers conflate stablecoins with volatile cryptocurrencies. Credit unions can serve as trusted educators – clearly explaining how stablecoins work, their risks and how they fit into a responsible digital financial strategy.
Looking Ahead
With the GENIUS act becoming law in the United States, we can expect rapid growth in the U.S. stablecoin market. Use cases will expand as retailers, banks and fintechs compete and collaborate to define this next chapter of programable digital payments.
For credit unions, the path is clear: don’t sit on the sidelines. Whether testing payments, partnering with fintechs or supporting member access, now is the time to experiment, adapt and build strategies for how to leverage this evolving money movement ecosystem. Stablecoins are reshaping the financial system – and credit unions can play a pivotal role in helping members navigate what comes next.
Vladimir Jovanovic: As Velera’s vice president of Innovation, Vladimir Jovanovic is passionate about harnessing the power of creative disruption with his team, focusing on new technologies and innovations in the payment space, with potential to create new opportunities and business models. With over 25 years of payment industry experience, Vladimir is a proven payment strategy leader, focused on providing products and services that position Velera and its credit unions for success.
