Stellar’s stablecoin expansion draws questions over XLM demand

Stellar integrates with global payment networks

London-based fintech company BVNK recently added Stellar to its stablecoin payments platform. BVNK’s integration enables over 130 business markets to send and receive cross-border payments and handle merchant payouts and treasury transfers using Stellar. The move forms part of a strategy to offer businesses seamless access to digital dollar liquidity for international settlements.

In a related development, the stablecoin USDT0 is now available on the Stellar blockchain, enhancing access to unified digital dollar liquidity across multiple networks. This allows companies to transfer digital dollars globally, bypassing the need to hold or transact with XLM directly.

Separately, U.S. Bank has piloted its proprietary stablecoin, USBDC, settling transactions between North American and European branches using Stellar’s infrastructure. These integrations demonstrate Stellar’s evolving role as an institutional-grade payments network.

Mini dictionary: BVNK is a global payments platform specializing in stablecoin settlements for institutional clients and fintech companies.

Institutional clients increasingly use Stellar for global settlements, with stablecoins like USDT0 now enabling frictionless payments across global markets without direct reliance on XLM holdings.

Stablecoin adoption and XLM: mixed signals on demand

The growing use of stablecoins on Stellar brings new questions about the XLM token’s role. Market participants and analysts note that, while Stellar facilitates more transactions as an infrastructure layer, businesses can settle payments using stablecoins such as USDC and USDT0, rather than the network’s native XLM.

This distinction points to a divergence between network activity and token value. Although XLM is required for transaction fees and basic account needs, the primary settlement currency for many institutional users remains the stablecoin itself. As a result, rising stablecoin transaction volume on Stellar might not translate to matching growth in XLM utility.

Stellar’s continued utility as a settlement network may not guarantee increased demand for XLM, since many business users now operate entirely with stablecoins for their payments, keeping digital dollar value on-chain.

Some industry researchers emphasize that, while XLM remains critical for maintaining the network, its usage may be limited to covering transaction fees and enabling account creation, unless broader application growth emerges.

Potential scenarios for XLM’s role

If current trends persist, Stellar might evolve into a leading platform for stablecoin transfers while the demand for XLM stays relatively flat. Some analysts envision that as the network hosts more enterprise users and applications, XLM’s usage for fees, reserves, and on-chain liquidity could increase gradually over time.

Alternatively, should XLM become a favored tool for bridging between different digital assets and fiat currencies, renewed interest might appear if payment volumes and ecosystem activity align with greater direct token utilization. For now, trends in stablecoin supply, institutional adoption, and overall payment activity may offer clearer indicators for XLM’s future than its current price action alone.