Tether Co-founder Predicts Global Fiat Currencies to Become On-Chain Stablecoins by 2030

Executive Summary

Tether co-founder Reeve Collins has predicted that all global fiat currencies, including the US Dollar, Euro, and Japanese Yen, will transition to operate as on-chain stablecoins by 2030. This projected transformation is primarily driven by the increasing adoption within traditional finance and the compelling efficiency benefits offered by asset tokenization. This shift is anticipated to fundamentally redefine global monetary systems.

The Event in Detail

Speaking at Token2049 in Singapore, Reeve Collins articulated his view that "all currency will be a stablecoin," defining a stablecoin as a traditional currency operating on a blockchain rail. He asserted that stablecoins would become the primary method for money transfer within the next five years, emphasizing that the advantages of tokenized assets have become too significant for traditional finance to disregard. Collins attributed this momentum to a positive shift in the US government's stance towards the crypto sector, which he noted has "opened the floodgates" for large Traditional Finance (TradFi) firms. He observed that virtually every major institution and bank is now actively pursuing the creation of their own stablecoins, recognizing their inherent utility and lucrative potential.

Financial Mechanics and Business Strategy

The predicted shift is underpinned by the advanced financial mechanics of tokenization, which involves representing physical or traditional financial assets as digital tokens on a blockchain. This mechanism facilitates fractional ownership, simplifies asset transfer, and enables on-chain programmability, thereby unlocking liquidity in markets historically characterized by illiquidity. A prominent example is BlackRock's tokenized money market fund, which rapidly accumulated over $500 million in tokenized US Treasuries on the Ethereum blockchain.

Interbank settlement is also evolving, with SWIFT piloting on-chain messaging and settlement systems in partnership with Linea, an Ethereum Layer-2 network. This initiative includes the development of an interbank settlement token designed to function similarly to a stablecoin, allowing for rapid and final settlement across distributed ledgers without replacing fiat currencies. Future stablecoin designs aim to reduce capital intensity and enhance stability, with models backed by tokenized Treasuries dynamically adjusting supply via on-chain oracles. Hybrid collateral structures that blend short-dated Treasuries with tokenized gold, REIT shares, or investment-grade credit are being explored to meet specific financial requirements.

Collins emphasized that institutions are strategically moving into the crypto sector, with blockchain-based stablecoins being a key focus due to their inherent utility and the lucrative opportunities they present in streamlining transactions.

Market Implications

This widespread adoption of stablecoins implies a fundamental transformation of global monetary systems, blurring the lines between centralized finance (CeFi) and decentralized finance (DeFi) and driving significant blockchain adoption. Stablecoins are transitioning from niche crypto instruments to critical programmable infrastructure, facilitating instantaneous, low-cost settlement and bridging disparate payment systems. Arthur Hayes posited that stablecoins serve as "New Bridge Assets" capable of unlocking trillions in new liquidity.

Regulatory frameworks are progressing, with stablecoin regulation fully or partially in force in 11 of 25 major jurisdictions by July 2025. The US GENIUS Act sets precedents by mandating full backing by high-quality liquid assets, timely redemption, and subjecting issuers to AML/CFT requirements. Despite the advancements, risks remain, including blockchain bridge security vulnerabilities, smart contract exploits, crypto wallet security breaches, and sophisticated phishing attacks. In the first six months of 2025, Web3 lost over $3.1 billion to hacks, with access-control failures, wallet compromises, and phishing campaigns contributing significantly to these losses. Cross-chain infrastructure, particularly bridges, continues to be a high-value target.

Broader Context

Distributed Ledger Technology (DLT) has reached a maturity inflection point, marked by stabilizing regulatory environments and ongoing scalability improvements. This progress enables the development of new digital financial products that leverage smart contracts to eliminate counterparty risk and automate complex settlement procedures. The "tokenization narrative" is robust, promising increased transparency and efficiency across asset classes. Collins' vision aligns with a broader trend where all forms of finance are poised to operate on-chain, signifying a pivotal shift in how financial services are delivered and consumed globally.