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Stablecoins promise to move money across borders in seconds instead of days, at a fraction of the cost of traditional international payments. They can circulate around the clock without waiting for banks to open or settlement systems to restart after a weekend.

Yet despite years of growth, stablecoins remain far from becoming an everyday payment tool for most consumers and businesses. Even among an audience gathered at a Hong Kong event organized by Deloitte and the Italian Chamber of Commerce dedicated to cross-border payments and digital assets, only a handful of participants said they actually used stablecoins for payments.

The gap between technological potential and real-world adoption remains stubbornly wide as a series of practical, regulatory and governance challenges continue to stand in the way of widespread adoption.

For Alessio Quaglini, chief executive and co-founder of Hex Trust, a digital asset financial institution, the future of stablecoins lies less in consumer wallets than in the infrastructure behind them.

He argued that the technology could become a core layer of the banking system while remaining largely invisible to end users, who are unlikely to embrace it for everyday spending because of concerns over privacy and complexity.

Public blockchains can expose large amounts of transactional information, while payment processes may require users to manage technical elements unfamiliar to most consumers.

“People want privacy. They don’t want the whole world to know exactly what they’re doing,” Quaglini said.

In some use cases, stablecoins already face competition from highly efficient traditional alternatives. Consumers can already move money relatively quickly through domestic instant-payment systems, banking apps and fintech platforms.

Fragmented systems, fragmented adoption

Interoperability also emerged as one of the most immediate hurdles.  According to Peter Koo, vice president of the Asia Family Office Foundation, the inability of different systems to communicate seamlessly remains a major obstacle.

He pointed to examples such as bank-issued digital tokens that cannot be redeemed across different institutions and payment networks that do not work together despite operating in the same market.

A token issued by one bank may function within that bank’s ecosystem but become far less useful outside it. Similarly, crypto wallets often remain disconnected from traditional bank accounts, forcing users to maintain separate financial infrastructures.

The result is fragmentation. “Why don’t we actually get all these unified to make it really work?”, Koo said.

Users must navigate a patchwork of wallets, banking platforms, service providers and regulatory frameworks rather than a unified payment experience. While digital assets were originally envisioned as a way to reduce friction, many users still encounter new layers of complexity before they can benefit from the technology.

The challenge extends beyond private-sector infrastructure. Different countries maintain different regulatory approaches, while central banks often prioritize their own digital currency projects.

Achieving interoperability across borders therefore requires not only technological integration but also regulatory coordination among governments and institutions that may have diverging priorities.

Who governs the stablecoin ecosystem?

Governance issues also raise questions over the credibility of the system. Quaglini argued that the current stablecoin ecosystem relies heavily on the discretion of a small number of influential industry figures rather than on broadly understood and institutionalized governance mechanisms.

Following the $6.3 billion Binance hack, billions of dollars in digital assets were frozen after Binance founder Changpeng Zhao, known as CZ, personally appealed to Tether CEO Paolo Ardoino and Circle co-founder Jeremy Allaire for assistance.

“These people are not regulators. They are not prime ministers. They are just very successful entrepreneurs who have not been formally mandated or entrusted with such authority by any public institution”.

While such actions may have helped contain losses, they also raised uncomfortable questions about who ultimately exercises authority within the system.

In traditional finance, customers generally understand that disputes, fraud investigations and asset freezes occur within legal and regulatory frameworks. In the stablecoin market, however, critical decisions may still depend on a relatively small group of entrepreneurs.

Trust requires understanding

“Technology builds efficiency, but governance builds trust,” Koo said, adding that trust also depends on something less visible but equally important: user understanding.

For many consumers, stablecoins remain unfamiliar. While awareness of digital assets has grown considerably, understanding of how wallets work, how transactions are executed, what risks are involved and how assets are safeguarded remains limited.

The panelists argued that education remains a prerequisite for broader adoption. Koo compared stablecoin adoption to the earlier adoption of artificial intelligence tools. Many people may have heard of the technology, but relatively few are comfortable using it in more advanced or consequential ways.

Robert Lui of Deloitte China stressed that user education is essential not only for retail investors but also for institutions. Participants need to understand the underlying use cases, potential benefits and associated risks before they are likely to change established financial behaviors, regardless of how sophisticated the technology may be, Lui said.

Security in the age of AI

Security presents another major hurdle.

The digital-asset industry has matured into a market measured in trillions of dollars, but it remains a frequent target for cybercriminals. Speakers referenced several high-profile hacks and warned that artificial intelligence is making attacks increasingly sophisticated.

Ralph Chammah, chief executive and co-founder of Blacklight AI, described cybersecurity as an ongoing process rather than a problem that can be solved through a single certification or compliance exercise.

Organizations must continuously adapt as attackers develop new methods and tools. AI-generated attacks and increasingly convincing deepfakes are already creating new challenges for anti-money laundering and know-your-customer processes, he said.

The implications extend far beyond direct financial losses. A major security breach can trigger operational disruption, litigation, regulatory scrutiny and reputational damage. For institutions considering digital-asset strategies, cybersecurity therefore becomes not merely a technical issue but a central business concern.

As Laura Demurtas of Deloitte noted, users need assurance regarding how funds are protected and who bears responsibility when failures occur.

Why the industry remains optimistic

Yet despite the challenges, the panelists were far from dismissive of the technology’s potential. If anything, they argued that stablecoins and digital assets could eventually transform financial infrastructure precisely because they address genuine shortcomings in existing systems.

Cross-border payments remain slow, costly and fragmented. Traditional transfers often involve multiple intermediary banks, currency conversions, cut-off times and settlement delays. Payments can take days to complete, while fees can be substantial and difficult to predict.

Stablecoins offer an alternative model. Transactions can occur nearly instantaneously, operate continuously rather than only during banking hours and significantly reduce settlement costs. Some speakers noted that payments can be processed at costs measured in basis points rather than percentage points. The technology also allows value to move at any time of day, including weekends and holidays.

Beyond payments, several participants argued that tokenization may ultimately prove more transformative than stablecoins themselves.

Digital representations of assets such as stocks, bonds or gold can exist on the same blockchain infrastructure and move according to the same technical standards.

This potentially enables transfers of financial assets across borders with a speed and simplicity that traditional systems struggle to provide. What currently requires multiple institutions, custodians and administrative processes could, in principle, occur through a unified digital framework.

The technology could also reduce inefficiencies in global finance. Payment providers today often maintain significant pools of capital across multiple jurisdictions to facilitate transfers. More integrated digital-asset infrastructure could eventually reduce some of those costs and capital requirements.

That future, however, remains conditional rather than guaranteed.

The discussion in Hong Kong suggested that the next stage of digital-asset adoption will depend less on technological innovation than on solving institutional problems.

Interoperability must improve. Governance structures need to mature. Regulatory standards require greater consistency across jurisdictions. Security frameworks must keep pace with increasingly sophisticated threats. Users need clearer education and more compelling use cases.

Above all, the industry must earn trust.

(in the opening picture, from left : Laura Demurtas, equity partner, tax financial services, Deloitte; Alessio Quaglini, CEO and co-founder Hex Trust, Peter Koo, vice president Asia family office foundation; Ralph Chammah, CEO and co-founder Blacklight; Robert Lui, JP, HK digital asset leader and Hong Kong growth and markets leader, Deloitte China)

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