The current cross-border payment system relies on a network of correspondent banks, each maintaining pre-funded accounts to facilitate transactions. This model is capital-intensive and lacks transparency.
Stablecoins, such as USD Coin and Tether, are digital assets that could disrupt this infrastructure. By combining messaging and settlement in a single transaction, stablecoin transfers can occur instantly across blockchain networks.
This shift has significant implications for banks and financial institutions, which may struggle to adapt to the new landscape. Those that do will gain advantages in speed, cost efficiency, and access to global payment flows.