Coinbase Stands to Gain Big as STABLE Act Ushers in a New Era for Stablecoins

The regulatory ground beneath the crypto industry is shifting. And as the U.S. gears up to formalize how stablecoins are governed, not all players will survive the shakeout. But for a few key incumbents—like Coinbase, PayPal, and Visa—the proposed STABLE Act could become a major tailwind.

A new report from blockchain analytics firm Nansen highlights how regulation, rather than stifling crypto innovation, could actually concentrate power in the hands of already-compliant giants. The result? A more mature, institutionally aligned stablecoin ecosystem—with Coinbase emerging as the top beneficiary.

Let’s break down how the STABLE Act is set to reshape stablecoins—and which companies stand to win big.

The STABLE Act: A Watershed Moment for U.S. Stablecoin Regulation

What’s in the Bill?

Passed by the U.S. House Financial Services Committee on April 2, the STABLE Act (Stablecoin Transparency and Accountability for Business and Legal Equilibrium) seeks to bring order to the still-chaotic world of stablecoins. Its three main goals:

• Protect stablecoin holders

• Ensure transparency by issuers

• Strengthen the dominance of the U.S. dollar

In short, it’s a compliance-first framework designed to filter out underregulated players and enforce a baseline of trust.

Key Provisions

Among its core mandates:

• Full Reserve Backing: Stablecoins must be backed 1:1 by cash or U.S. Treasuries—no risky commercial paper or fractional reserves.

• No Interest for Holders: Prevents stablecoins from behaving like unlicensed savings products.

• Issuer Requirements: Only licensed banks, OCC-regulated firms, or approved state-chartered trust companies may issue them.

This narrows the field dramatically—and sets the stage for trusted financial firms and crypto platforms to take the lead.

Coinbase: The Clear Winner in a Compliant Future

Already a Partner in USDC

Coinbase, through its partnership with Circle, is the primary distributor of USDC, the second-largest stablecoin in the world. USDC already meets the STABLE Act’s criteria: it’s fully backed by dollar-denominated assets, subject to regular attestations, and backed by an issuer—Circle—that prioritizes regulatory alignment.

Coinbase has long played the regulatory game with strategic foresight. Its public listing in 2021 and ongoing lobbying efforts have helped position it as the “safe choice” for institutional crypto exposure. That groundwork could now pay off handsomely.

Positioned to Dominate Retail and Institutional Use

Unlike pure payment companies, Coinbase controls both the infrastructure and the distribution channels for USDC. That gives it an edge in expanding USDC’s role in:

• Crypto trading and DeFi

• Global remittances

• On-chain payments

• Web3 commerce

As the STABLE Act enforces stricter standards, Coinbase could see a surge in USDC demand, especially from traditional finance institutions looking for compliant digital dollar exposure.

PayPal: A Sleeping Giant Awakening

PYUSD: Small Footprint, Big Potential

PayPal made waves with the launch of PYUSD in 2023, issued in partnership with regulated firm Paxos. Although its current market share is just 0.38%, PYUSD now benefits from having been early and compliant.

What sets PayPal apart is its ecosystem reach. With millions of merchants and users, it could integrate PYUSD across its:

• Checkout services

• Peer-to-peer payments

• Business payouts

If the STABLE Act passes, PayPal’s existing infrastructure could rapidly onboard users into a stablecoin-powered future—with regulatory cover already in place.

Building Toward Long-Term Relevance

While PayPal’s current crypto operations are modest, the STABLE Act could provide the legal certainty it needs to double down on stablecoin innovation without alienating shareholders or regulators. Expect PayPal to lean heavily into this once the rules are finalized.

Visa and Mastercard: Payments Meet Blockchain

Testing the Waters with USDC

Visa, and to a lesser extent Mastercard, have already begun piloting stablecoin settlement systems. Visa has used USDC to settle transactions across multiple markets, demonstrating that traditional payment rails and crypto can be interoperable.

Under the STABLE Act, Visa and Mastercard are well-positioned to:

• Offer B2B stablecoin payment rails

• Settle cross-border transactions faster and cheaper

• Explore embedded finance and tokenized payments

Both companies are compliance-first institutions, meaning regulatory clarity could accelerate their stablecoin roadmap rather than delay it.

Who’s Not on the List? USD1 and the Politics of Ecosystems

One notable omission from Nansen’s list is USD1, the stablecoin launched by World Liberty Financial, a Trump-affiliated crypto company. At face value, USD1 meets many of the STABLE Act’s criteria—it’s fully backed and operated by a regulated entity.

But USD1 lacks what the winners have in abundance: ecosystem power.

• Coinbase has DeFi, wallets, and exchange integration.

• PayPal has global reach and a seamless user experience.

• Visa and Mastercard are embedded in the global payments fabric.

By contrast, USD1 is new, politically polarizing, and ecosystem-light. Until it finds broader usage beyond political circles, it’s unlikely to benefit from regulation in the same way.

Regulation Will Reward the Ready

The STABLE Act won’t kill innovation—it will professionalize it. By setting clearer rules and raising the bar for entry, it’s poised to consolidate the stablecoin market into the hands of prepared, regulated, and trusted players.

That means:

• Coinbase’s role as USDC’s distributor becomes more valuable

• PayPal’s PYUSD gets a fresh lease on life

• Visa and Mastercard can finally scale stablecoin adoption at the enterprise level

For investors, this signals a shift: compliance isn’t a constraint anymore—it’s a moat. And the firms who’ve been playing the long game are about to be rewarded.

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