Everyone worldwide is issuing stablecoins, but buyers are the moat.
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Everyone worldwide is issuing stablecoins, but buyers are the moat.
In the future, the competition among stablecoins will shift from the tokens themselves to the business closed loops and network effects built around them.
Navigating Web3 tides with focused insightsAuthor: Chuk
Translated by: TechFlow
TechFlow Intro: As regulatory frameworks for cryptocurrencies—such as the GENIUS Act—become clearer, stablecoins are evolving from simple mediums of exchange into enterprise-grade financial infrastructure. This article offers an in-depth analysis of the “Issuance-as-a-Service” stablecoin market. Author Chuk argues that while the underlying token minting technology has become increasingly commoditized, differences among issuers in compliance posture, liquidity operations, and ecosystem integration render them highly irreplaceable for distinct buyer categories—enterprises, fintechs, and DeFi protocols. In the future, competition will shift away from the tokens themselves toward the business loops and network effects built around them.
The underlying token architecture is converging—but outcomes diverge dramatically.
This article was originally published on Stablecoin Standard, where you can find the full archive and subscribe to receive this and other analytical reports via email. Special thanks to Artemis for issuer data!
Introduction: Everyone Is Launching Stablecoins
Stablecoins are transforming into application-layer financial infrastructure. With rules becoming clearer following the passage of the GENIUS Act, brands like Western Union, Klarna, Sony Bank, and Fiserv are shifting—from “integrating USDC”—to “launching their own USD-backed tokens”—via white-label issuance partners.
This shift is being driven by the rapid proliferation of “Issuance-as-a-Service” platforms. A few years ago, Paxos was virtually the only viable candidate. Today, depending on your product’s requirements, there are over a dozen reliable options—including emerging platforms like Bridge and MoonPay, compliance-first players like Anchorage, and established giants like Coinbase.
This abundance makes issuance appear “commoditized.” And indeed, at the level of token plumbing, convergence is accelerating. Yet whether something is truly commoditized depends on the buyer—and the job they need done.
Once you separate token plumbing from liquidity operations, compliance posture, and adjacent infrastructure (on/off-ramps, orchestration, accounts, cards), the market no longer resembles a pure price war—it looks more like competition across distinct segments. Pricing power is concentrating in areas where outcomes are hardest to replicate.
Caption: White-label stablecoin supply is growing rapidly, creating a large new issuer market beyond USDC/USDT. Source: Artemis
If you treat issuers as interchangeable, you’ll overlook the real constraints—and where profits are most likely to persist.
Why Do Brands Launch Their Own Stablecoins?
This is a good question. Companies do so primarily for three reasons:
- Economic value: Capture more value from customer activity (balances and flow) and tap adjacent revenue streams (treasury management, payments, lending, cards).
- Behavioral control: Embed custom rules and incentives (e.g., loyalty programs), and select settlement paths and interoperability options aligned with product needs.
- Speed: Stablecoins let teams deploy new financial experiences globally without rebuilding full banking stacks.
Importantly, most branded tokens don’t need to reach USDC-scale to be considered “successful.” Within closed or semi-open ecosystems, key performance indicators (KPIs) need not be market cap—they can instead be average revenue per user (ARPU) and improved unit economics: i.e., how much additional revenue, retention, or efficiency the stablecoin functionality unlocks.
How Do White-Label Issuers Work?
To assess whether issuance is truly commoditized, we must first define the work involved: reserve management, smart contracts + on-chain operations, and distribution.
Caption: Issuers handle reserves and on-chain operations; brands drive demand and distribution. Differentiation lies in the details.
White-label issuance allows a company (the brand) to launch and distribute its branded stablecoin while outsourcing the first two layers to a licensed issuer.
In practice, ownership splits across two domains:
- Largely owned by the brand: Distribution—where the token is used, default UX, wallet placement, and which partners or venues support it.
- Largely owned by the issuer: Issuance operations—smart contract layer (token rules, admin permissions, mint/burn execution) and reserve layer (reserve assets, custody, redemption operations).
Operationally, most components are now productized via APIs and dashboards, enabling go-to-market timelines ranging from days to weeks depending on complexity. While not every project today requires a U.S.-compliant issuer, for issuers targeting U.S. enterprise buyers, compliance posture had already become part of the product—even before formal implementation of the GENIUS Act.
Distribution is the hardest part. Within closed ecosystems, getting users to adopt the token is largely a product decision. Outside those ecosystems, however, integration and liquidity become bottlenecks—and issuers frequently break through these barriers by assisting with secondary-market liquidity (exchange/market-maker relationships, incentives, capital provision). The brand retains demand ownership, but this “go-to-market support” is one of the few places where issuers can meaningfully change outcomes.
Different buyers weigh these responsibilities differently—which is why the issuer market has fractured into distinctly different clusters.
The Market Is Fragmented—Commoditization Depends on the Buyer
“Commoditization” occurs when a service becomes sufficiently standardized that providers become interchangeable without altering outcomes—shifting competition from differentiation to price.
If switching issuers changes outcomes you care about, then issuance is not commoditized for you.
At the token-plumbing layer, switching issuers usually does not change outcomes—making them increasingly interchangeable. Many issuers hold treasury-like reserves, deploy audited mint/burn contracts, provide basic admin controls (pause/freeze), support major public chains, and offer similar APIs.
But brands rarely buy just simple token deployment. They buy “outcomes”—and required outcomes vary sharply by buyer type. The market fractures into several clusters, each with a tipping point beyond which alternatives fail. Within each cluster, teams often have only a handful of viable options:
- Enterprises & Financial Institutions: Procurement-driven, optimized for “trust.” Alternatives fail when compliance credibility, custody standards, governance, and 24/7 redemption reliability at scale ($100M+) differ. In practice, this is “risk committee” procurement: issuers must be bulletproof on paper—and rock-solid in production.
- Fintechs & Consumer Wallets: Product-driven, optimized for “launch and distribution.” Alternatives fail based on time-to-launch, depth of integration, and supporting infrastructure (e.g., on/off-ramps) that enable real-world workflows. In practice, this is “ship in this sprint” procurement: the winning issuer is the one that minimizes KYC/onboarding/orchestration work—and gets your entire feature (not just the stablecoin) live fastest.
- DeFi & Investment Platforms: Natively on-chain, optimized for “composability” and “programmability”—including designs that trade off risk profiles to optimize yield. Alternatives fail on reserve model design, liquidity dynamics, and on-chain integration. In practice, this is “design constraint” procurement: teams accept different reserve mechanisms if they improve composability or yield.
Caption: Issuers cluster by enterprise compliance posture and access approach—enterprises & financial institutions (bottom right), fintechs/wallets (center), DeFi (top left).
Differentiation is moving up the protocol stack—a trend especially visible in the fintech/wallet segment. As issuance becomes a “feature,” issuers compete by bundling adjacent infrastructure that completes the full workflow and enables distribution: compliant on/off-ramps, virtual accounts, payment orchestration, custody, and card issuance. This sustains pricing power by changing time-to-market and operational outcomes.
Caption: Though over ten white-label stablecoin issuers exist, options quickly collapse to just a few for any given buyer.
With this framework, the commoditization question becomes clear.
Stablecoin issuance is commoditized at the token layer—but not yet at the outcome layer—because buyer constraints prevent providers from being interchangeable.
As the market matures, issuers serving each cluster may converge on similarly featured products—but we’re not there yet.
Where Might Durable Advantages Come From?
If token plumbing is now table stakes—and marginal differentiation is slowly eroding—the obvious question is: Can any issuer build a durable moat? Today, this looks more like a customer-acquisition race, with retention driven by switching costs. Switching issuers involves reserve/custody operations, compliance processes, redemption behavior, and downstream integrations—so issuers are far from “one-click replaceable.”
Beyond bundling, the most plausible long-term moat is network effects. If branded stablecoins increasingly require seamless 1:1 redemptions and shared liquidity, value may accrue to the issuer—or protocol layer—that becomes the default interoperability network. An open question remains: Will this network be issuer-owned (strong control) or a neutral standard (broad adoption, weak control)?
A pattern worth watching: Will interoperability become a commoditized feature—or the primary source of pricing power?
Summary
- Today, issuance is commoditized at its core—but differentiated at the edges. Token deployment and basic controls are converging. Yet where operations, liquidity support, and integration matter most, outcomes still diverge significantly.
- For any specific buyer, the market isn’t as crowded as it appears. Real-world constraints rapidly narrow the candidate list—and “reliable options” often number just a few—not ten.
- Pricing power stems from bundling, regulatory posture, and liquidity constraints. Value lies less in “creating the token” and more in the surrounding infrastructure that makes stablecoins production-ready.
- It remains unclear which moats will prove sustainable. Network effects built via shared liquidity and redemption standards represent one viable path—but as interoperability matures, it’s not obvious who will capture the value.
What to watch next: Will branded stablecoins converge onto a few redemption networks—or will interoperability evolve into a neutral standard? Either way, the lesson is the same: The token is just the ticket. The business is everything built around it.
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