The Stablecoin Paradox
Build, Partner, or Adopt
The Paradox
After more than a decade of searching for real-world use cases, blockchain has finally found one that institutions can't ignore: stablecoins.
From 2024–2025, dozens of stablecoins launched and quickly crossed eight-figure supplies. PayPal, Klarna, Sony, and BBVA all announced initiatives, and it feels like every passing day a new heavyweight enters the ring.
But here’s what’s interesting: most of them are not actually building stablecoins themselves.
PayPal, with hundreds of millions of users and one of the most sophisticated fintech infrastructures in the world, partnered with Paxos to issue PYUSD. Klarna partnered with Bridge. Even Sony, building an entire blockchain for gaming, is partnering with Bastion for its stablecoin.
Why? Because launching a stablecoin isn't as simple as writing a smart contract, holding dollars in a bank account, and promising 1:1 redemption. Stablecoins require extensive regulatory infrastructure, operational processes, compliance oversight, and 24/7/365 operations - often a level of commitment most businesses don’t actually want.
This is the stablecoin issuance paradox: everyone wants a stablecoin, but almost nobody wants to be in the stablecoin business.
Moving Parts
On the surface, stablecoin issuance looks straightforward: hold dollars in an account, represent them on a blockchain, enable 1:1 redemption. “Blockchain + bank account = $$$, right?”
In reality, it’s not just harder than expected - it’s a completely different category of business.
Launching a stablecoin compliantly requires building systems across three areas:
Regulatory Infrastructure
Money transmitter licenses across 49+ states, or a trust charter (like Paxos's NYDFS charter obtained in 2015)
Emerging federal stablecoin frameworks (like the GENIUS Act): 1:1 reserve backing, monthly third-party attestations, capital requirements, public disclosures, and reserve restrictions (only US dollars, Fed deposits, short-term Treasuries)
Operational Systems
Reserve custody relationships for holding billions securely
24/7 redemption infrastructure (blockchains operate round the clock; banks don't)
Multi-chain deployment across Ethereum, Solana, and other networks
Liquidity management to ensure cash is always available for redemptions
Compliance & Risk Monitoring
AML/KYC verification for all users
OFAC sanctions screening
Real-time transaction monitoring
Complete audit trails for regulatory examinations
These aren't software complexities - they're financial services complexities. Multi-state licensing alone can take a year or more and millions in legal fees.
Take PayPal as an example. With their massive user base, decades of fintech infrastructure, deep regulatory relationships, and capital to invest, they had everything needed to build their own stablecoin infrastructure.
Yet, they chose to partner with Paxos to issue PYUSD.
Paxos was uniquely positioned: NYDFS trust charter, existing reserve custody relationships, compliance infrastructure already built, and a proven track record issuing BUSD and USDP.
The decision was straightforward. PayPal is a payments business, not a trust company. Time + Focus + Trusted Partner > Builder's Headache.
This gap between wanting a stablecoin and building the business isn't unique to PayPal. It's the choice most companies now face: build, partner, or adopt.
Strategic Paths
Understanding this complexity reveals three distinct paths for companies evaluating stablecoin issuance:
Path 1: Build
This path is for companies whose primary business is stablecoin issuance, or large financial institutions with the asset size, regulatory expertise, and tolerance for multi-year timelines.
Examples: Circle (USDC), Tether (USDT)
Building requires:
18-24 month timeline
$10M+ initial investment
Ongoing operational costs
Full regulatory infrastructure build-out
Circle is the canonical case: they built the full stack with regulatory licenses, reserve management, compliance infrastructure, and multi-chain deployment. USDC is now the second-largest stablecoin with over $40B in circulation.
The bar: If stablecoin issuance isn't the company's core business and it doesn't have JPMorgan-level scale and regulatory relationships, it's not in this category.
Path 2: Partner
This is where the paradox resolves. Infrastructure providers handle issuance and operations on the company’s behalf — either directly as the regulated issuer (Paxos), or indirectly by orchestrating regulated issuers behind a single API (Bridge).
The division of labor:
Partner handles: Regulatory infrastructure, reserve management, compliance, 24/7 operations
Company handles: Marketing, product, user experience, customer acquisition
What the company gets:
Time to market: 3-6 months (not 18-24)
Branded stablecoin with its name
Share of reserve yields (typically 70-80% vs. 100% if you build)
Regulatory risk transferred to partner
Focus on their core business
What they give up:
Some yield economics (but faster to revenue)
Operational control (dependency on partner infrastructure)
Deep customization (standardized offerings)
Examples in the wild:
PayPal + Paxos = PYUSD (~$3.4B supply as of late 2025, launched in months)
Klarna + Bridge = Klarna stablecoin (expected 2026)
Sony + Bastion = Stablecoin on Sonium L2 blockchain
Here's what's counterintuitive: even companies building their own blockchains are partnering for stablecoins. Sony has the technical capability to build an entire Layer 2, but they're still partnering for the stablecoin piece.
The distinction matters: blockchain infrastructure is a technical challenge. Stablecoin issuance is a regulatory and operational challenge. Different skill sets entirely.
Path 3: Adopt
For most companies, the smartest stablecoin strategy is not issuing one at all.
Instead, integrate existing stablecoins (USDC, USDT) with deep liquidity and network effects, and focus differentiation on product and user experience, not token infrastructure.
The model:
Integrate USDC/USDT via APIs
Build your product/UX on top - Launch in 1-3 months
Zero infrastructure burden
What the company gets:
Deepest liquidity (USDC + USDT = 80% of stablecoin market)
Immediate interoperability across the entire crypto ecosystem
No regulatory buildout required
Can focus entirely on your actual product
What they give up:
Branded token (no "ecosystem lock-in" from your own currency)
Direct yield economics on reserves
Positioning as a "stablecoin issuer"
Example: Nook, a fintech focused on yield aggregation, uses USDC on Base. Founder Joey Isaacson's take: "Everyone has a debit card. It's not innovation anymore." His point: issuing a payment instrument isn't differentiation - what you do with it is.
When this makes sense:
Stablecoin is a feature of your product, not your product
You don't have massive distribution (100M+ users) to justify branded token
Speed matters more than brand
You'd rather compete on UX than infrastructure
Think of it this way: Visa doesn't issue dollars, they move them. That's still a trillion-dollar business. For most companies, stablecoin integration is innovation. Stablecoin issuance is distraction.
So which path is right for your business?
Choosing a Path
In practice, most companies should default to Partner or Adopt, not Build.
Build only makes sense for companies where stablecoin issuance is the business, think Circle, Tether, Paxos, or you’re a large financial institution with long time horizons and deep pockets. If stablecoins are a feature of your product rather than the product itself, eliminate Build.
That leaves Partner vs. Adopt:
Partner makes sense when a branded token creates strategic value—whether through ecosystem lock-in, yield economics, or market positioning. Companies like PayPal, Klarna, and Sony are taking this path despite having different levels of scale and technical capability.
Adopt makes sense when stablecoin is pure payment functionality. Integrate USDC/USDT, launch quickly, and compete on your actual product. This is what Nook chose: USDC integration rather than issuance, focusing differentiation on their yield product.
The key insight: the decision isn't primarily about scale or technical capability. It's about whether a branded stablecoin creates enough strategic value to justify the partnership complexity, or whether you'd rather just integrate existing infrastructure and move on.
Looking Ahead
The stablecoin market is shifting. While many companies still announce plans to issue their own tokens, infrastructure providers like Paxos and Bridge are creating a new category: stablecoin-as-a-service.
This mirrors other infrastructure markets. AWS didn't eliminate companies running their own servers, but it made "build your own data center" the exception, not the default.
The same shift is happening with stablecoins. The winners won't be the dozens of companies announcing issuance plans. They'll be the infrastructure layer enabling them, and the companies smart enough to partner or adopt rather than build.
For most teams, the hardest part isn't deciding whether to use stablecoins - it's deciding how much infrastructure they actually want to own.