Stablecoins have the potential to cut the cost and time of cross-border payments, but differing regulatory systems by country are blocking broader adoption, the World Trade Organization (WTO) said.

On Sept. 14 (local time), Cointelegraph reported that Juan Marchetti (후안 마르케티), director of the WTO’s Trade in Services and Investment Division, said at an event in Geneva to launch the report "Stablecoins and World Trade" that "the constraint is not technology but regulation and shortcomings in regulatory frameworks". Marchetti said stablecoins still account for about 3 percent of total international payments.

The WTO said stablecoins can ease high costs and slow processing speeds in cross-border payments, limited access, insufficient transparency, foreign-exchange constraints and other factors. Cross-border stablecoin payment volumes rose 35-fold from 2020 to mid-2024. Developing countries, where remittance costs are a heavy burden, are more likely to benefit, but their regulatory foundations were found to be relatively weak.

Regulatory gaps also persist. Of 28 jurisdictions surveyed by the Financial Stability Board (FSB) last year, only 11, or 39 percent, had finalized a global stablecoin regulatory framework. The FSB said differing national systems could create regulatory arbitrage and make cross-border supervision difficult.

Private payment companies are already expanding their use. Mastercard announced in June plans to expand on-chain settlement using regulated stablecoins such as USDC and RLUSD, and to broaden intraday, weekend and holiday settlement. Western Union also partnered with Rain last month to launch a stablecard in 37 markets that can hold, remit and pay with a dollar-pegged stablecoin, and plans to expand to more than 60 markets by year-end.

The WTO said regulatory alignment across countries and interoperability with existing financial networks are as important as technological advances if stablecoins are to become mainstream in global trade payments.