Stablecoin Revenue Models in 2025

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The stablecoin market has evolved from a niche crypto utility into a cornerstone of digital finance, reshaping how institutions manage capital, settle transactions, and generate yield. As adoption accelerates across fintech, retail, and banking sectors, the revenue models behind leading stablecoins reveal a strategic convergence of financial innovation and regulatory compliance. This article explores the monetization strategies of major players including Tether, Circle, PayPal, Walmart, JD.com, JPMorgan Chase, and Stripe—highlighting how they leverage reserves, ecosystems, and blockchain infrastructure to create sustainable income streams.

Tether: Yield from Reserves and Strategic Investments

Tether (USDT) remains the largest stablecoin by market capitalization, with its revenue model rooted in conservative financial instruments and forward-looking investments. USDT is pegged 1:1 to the U.S. dollar and backed by a reserve composed primarily of U.S. Treasury bills, cash equivalents, and other short-term instruments. The interest generated from these holdings forms the core of Tether's profitability.

In 2024, Tether reported over $13 billion in net profit**, with total equity surpassing $20 billion. This growth was fueled not only by its reserve yields but also by strategic investments through Tether Ventures**, which has allocated more than $2 billion into high-potential sectors such as renewable energy, artificial intelligence, telecom infrastructure, and Bitcoin mining—all separate from USDT’s backing assets.

By Q1 2025, Tether achieved an operating profit exceeding $1 billion, supported by strong performance in its Treasury portfolio. Its reserves reached **$121.6 billion** in cash and short-term deposits, with over-collateralization of $5.6 billion. Meanwhile, USDT’s circulating supply grew by $7 billion, and active wallets increased by 46 million—evidence of sustained global demand.

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A key milestone in 2025 was Tether obtaining a stablecoin issuer license in El Salvador, operating under the country’s formal digital asset framework. This regulatory validation strengthens trust and sets a precedent for compliant global expansion.

Circle: Revenue Sharing and Platform Synergy

Circle, the issuer of USD Coin (USDC), operates under a transparent and regulated model. While initially co-managed with Coinbase via the Centre Consortium, Circle took full control in 2023, assuming responsibility for issuance, governance, and reserve management.

Circle earns revenue primarily through interest on USDC reserves, which are held in cash, U.S. Treasuries, and other high-quality liquid assets. A significant portion of this yield is shared with Coinbase under a revenue-sharing agreement based on USDC volumes held on its platform.

Coinbase’s disclosures show stablecoin revenue grew from nearly $700 million in 2023** to **$910 million in 2024, accounting for 13.86% of total revenue. In Q1 2025 alone, it earned $298 million, reflecting a 51% year-over-year increase—the fastest-growing segment in its business.

Circle’s own revenues rose steadily: $772 million (2022), $1.45 billion (2023), and $1.676 billion (2024). This growth reflects rising adoption across DeFi, payments, and institutional finance.

With full autonomy over USDC’s smart contracts and compliance frameworks, Circle is well-positioned to expand into new markets while maintaining strict adherence to U.S. regulatory standards.

PayPal: Partner-Driven Stablecoin Monetization

PayPal’s entry into the stablecoin space came with PYUSD (PayPal USD), issued by Paxos Trust Company and fully backed by U.S. dollar deposits, Treasury securities, and reverse repurchase agreements. Notably, money market funds are excluded from the reserve composition.

While PayPal does not directly issue PYUSD, it benefits financially through a profit-sharing arrangement with Paxos. Interest earned on reserves funds Paxos’ custodial services and is partially passed to PayPal for distribution and user acquisition efforts.

PYUSD trades at a fixed rate of $1.00 within PayPal’s ecosystem. Users can buy, sell, or transfer PYUSD without fees on the platform. However, conversion fees apply when exchanging PYUSD for other cryptocurrencies—creating an additional monetization layer.

The closed-loop nature of PYUSD within PayPal’s network enables seamless integration into existing payment flows, paving the way for broader usage in peer-to-peer transfers, e-commerce settlements, and cross-border remittances—all while avoiding third-party network costs like those charged by Visa or Mastercard.

Walmart: Preparing for a Closed-Loop Payment Revolution

Though not yet launched, Walmart’s planned stablecoin signals a strategic shift toward bypassing traditional credit card networks that charge 2–3% per transaction. In collaboration with Amazon, Walmart is exploring a private, permissioned blockchain-based token designed for internal use across its supply chain and retail ecosystem.

This closed-loop stablecoin would function similarly to a digital voucher system—used between Walmart, its suppliers, and possibly customers—enabling instant settlement and reducing reliance on slow bank transfers or expensive card processors.

Under proposed U.S. regulations like the GENIUS Act, such tokens must be 1:1 backed by cash or equivalents like short-term Treasury bills, allowing issuers to earn interest income. For Walmart, this represents both cost savings and a new revenue stream via yield generation.

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JD.com: Bridging Cross-Border Trade with Hong Kong Stablecoins

JD.com is advancing its Hong Kong dollar-pegged stablecoin (JD Stablecoin) through Hong Kong’s regulatory sandbox. Following the passage of the Stablecoin Ordinance in May 2025, JD Blockchain (HK) Ltd aims to launch its token in late 2025 after successful testing phases.

Unlike many crypto-native stablecoins focused on speculation or DeFi lending, JD Stablecoin targets real-world trade finance—specifically cross-border payments between mainland China, Hong Kong, and Southeast Asia.

Testing scenarios include:

The first use case will be on JD’s own e-commerce platform, giving it a built-in "cold start" advantage. By anchoring the stablecoin in actual commerce rather than speculative trading, JD positions itself at the intersection of traditional finance and Web3 innovation.

JPMorgan: Deposit Tokens for Institutional Settlement

JPMorgan is pioneering a new category: the regulated deposit token (JPMD). Unlike public stablecoins like USDT or USDC, JPMD is a permissioned token available only to institutional clients on Coinbase’s Base network—a Layer 2 built on Ethereum.

Each JPMD represents a digital claim on a U.S. dollar deposit at JPMorgan Chase, making it fully insured and interest-bearing. Marketed by Kinexys (JPMorgan’s blockchain arm), JPMD enables:

JPMD complies with emerging U.S. frameworks such as the GENIUS Act: 100% reserve-backed, monthly attestation reports, and regulated issuance.

This model shifts the value proposition from pure payment efficiency to institutional-grade programmable money—blending traditional banking safety with blockchain speed.

Stripe: Empowering Global Businesses with Stablecoin Accounts

In May 2025, Stripe launched Stablecoin Financial Accounts, enabling businesses in 101 countries to hold, send, and receive stablecoin balances—starting with USDC and USDB (from Bridge). This follows Stripe’s acquisition of Bridge three months earlier.

These accounts allow companies—especially in high-inflation economies—to hedge against currency depreciation while accessing global markets instantly.

To bridge the gap between crypto and fiat commerce, Bridge partnered with Visa to issue spendable cards linked to stablecoin wallets. Through partners like Ramp and Squads, users can spend their stablecoins at any of the 150 million Visa-accepting merchants worldwide. Transactions are settled in local fiat automatically.

This integration solves one of stablecoins’ biggest adoption barriers: usability in everyday spending environments that don’t natively accept crypto.

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Frequently Asked Questions (FAQ)

Q: How do stablecoin issuers make money if the tokens are pegged 1:1 to fiat?
A: They earn interest by investing the fiat reserves in low-risk assets like U.S. Treasury bills. Since every dollar issued is backed by real-world assets generating yield, issuers collect returns without exposing users to price volatility.

Q: Are all stablecoins equally safe?
A: No. Safety depends on transparency, audit frequency, reserve composition, and regulatory oversight. Regulated issuers like Circle (USDC) and Paxos (PYUSD) publish regular attestations; others vary in disclosure quality.

Q: Can individuals earn yield on stablecoins?
A: Yes—through DeFi platforms, centralized lenders, or interest-bearing wallets. However, third-party platforms carry counterparty risk; holding stablecoins directly offers no yield unless provided by the issuer (e.g., JPMD).

Q: What role does regulation play in stablecoin revenue models?
A: Regulation increases trust and access to banking services but requires compliance costs. Frameworks like the GENIUS Act mandate full backing and monthly reporting—making yield generation more transparent but operationally rigorous.

Q: Why are big companies like Walmart and JD.com launching stablecoins?
A: To reduce transaction costs, speed up settlements within their ecosystems, and open new revenue channels via interest income—all while gaining control over their financial infrastructure.

Q: Will stablecoins replace traditional banking?
A: Not entirely—but they’re becoming critical infrastructure for specific use cases like cross-border payments, remittances, and programmable finance where speed and cost matter most.

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