Stablecoins shift to payments

Stablecoins are being pitched less as crypto trading chips and more as payment plumbing. Andreessen Horowitz’s crypto arm published new data on April 24, and Morgan Stanley launched a reserve fund for issuers on April 23. (a16zcrypto.com) (morganstanley.com) A stablecoin is a digital token designed to hold a fixed value, usually one U.S. dollar, so it can move on blockchain networks without the price swings of bitcoin or ether. Morgan Stanley’s new product is built for the cash and Treasury-style assets that back those tokens. (a16zcrypto.com) (morganstanley.com) Morgan Stanley Investment Management said its Stablecoin Reserves Portfolio sits inside the Morgan Stanley Institutional Liquidity Funds trust and is “primarily expected” to be held by stablecoin issuers. The fund is designed to maintain a constant $1 net asset value and focus on liquidity and capital preservation. (morganstanley.com) (morningstar.com) Morgan Stanley’s fund page says the minimum initial investment is $10 million. The firm’s announcement says the shares are meant to help issuers meet stablecoin reserve asset requirements. (morganstanley.com) (morningstar.com) Andreessen Horowitz’s crypto team said adjusted stablecoin transaction volume reached roughly $4.5 trillion in the first quarter of 2026. Its charts argue the growth had been building for several quarters and accelerated after U.S. regulatory clarity arrived. (a16zcrypto.com) The same post says Europe’s Markets in Crypto-Assets rules produced a different effect: several exchanges delisted Tether’s USDT at the end of 2024, and non-U.S.-dollar stablecoin activity briefly topped $40 billion. The point of the comparison is that regulation is now changing market structure, not just legal risk. (a16zcrypto.com) In the United States, that framework is the GENIUS Act. Congress.gov shows the bill passed the House and Senate on July 17, 2025, and legal summaries say it requires high-quality liquid reserves and creates a federal regime for payment stablecoin issuers. (congress.gov) (paulhastings.com) The law also narrows what issuers can do. The Richmond Federal Reserve summary says issuers cannot pay interest or yield to people who hold the stablecoins themselves, even though reserve managers can still earn income on the backing assets. (richmondfed.org) That distinction helps explain Morgan Stanley’s timing. If stablecoins are becoming payment instruments, the institutions that hold reserves, manage daily liquidity and keep portfolios inside the rules become more central to the business. (morganstanley.com) (arnoldporter.com) Andreessen Horowitz has been making that payments case for months. Its earlier research said stablecoins handled an estimated $46 trillion in transaction volume in 2025, approaching three times Visa’s annual volume, though that comparison depends on adjusted onchain data rather than card purchase volume. (a16zcrypto.com) (visaonchainanalytics.com) The near-term question is whether issuers, banks and payment companies build around that model fast enough to absorb the new money. The latest filings and charts suggest the market is now being organized around reserves and settlement, not only trading. (a16zcrypto.com) (morganstanley.com)