Stablecoins Could Solve Cross-Border Payment Lag for SMEs, Says XTransfer CEO

Digital tokens gain traction as alternative to shadow banking systems in developing markets

Cross-border business payments remain trapped in an analog world of email invoices and multi-day settlement times, even as global trade operates around the clock—a disconnect that stablecoins could finally resolve, according to Bill Deng, CEO of China-based fintech platform XTransfer.

Speaking at the Forum Ekonomi Malaysia in Kuala Lumpur in early February, Deng argued that while consumer and peer-to-peer transactions can now clear in minutes across borders, business-to-business payments still rely on outdated infrastructure. "When it comes to money, there's no 24/7 infrastructure," he told Fortune in an interview on the sidelines of the conference. "They negotiate deals via pro forma invoices, and they still exchange information via email."

The gap matters particularly for small and medium-sized enterprises in developing countries, where the formal banking system's limitations have pushed many businesses toward unregulated alternatives. Deng pointed to hawala, a centuries-old money transfer system where brokers in different countries settle payments through cash exchanges rather than bank transfers, as an example of how businesses route around traditional finance. "It's become the mainstream for SMEs in many developing countries," he said.

Stablecoins—digital tokens pegged to fiat currencies like the U.S. dollar—could provide a regulated alternative that combines speed with transparency, Deng argued. "For domestic payments, stablecoins do not add that much value," he said. "But for cross-border transactions, they can be extremely valuable." The technology promises to make payments "more transparent, faster, and with a much lower cost."

The regulatory landscape for stablecoins has begun to take shape. The United States, Japan, and Hong Kong have all established frameworks governing the tokens, lending legitimacy to what was once a purely crypto-native instrument. The total market value of all stablecoins has reached $300 billion, up 75% year-on-year, signaling growing adoption.

Yet actual payment volumes tell a different story. McKinsey estimates annual stablecoin payments at just $390 billion—a figure that represents only 0.02% of total global payment flows. The gap between market capitalization and transaction volume suggests stablecoins remain primarily a store of value or trading instrument rather than a payment rail.

The persistence of shadow banking systems like hawala underscores both the problem and the challenge. Hawala operates in areas underserved by traditional financial infrastructure and often moves money faster than correspondent banking networks. But its opacity has made it a target for anti-money laundering scrutiny, with governments concerned about its use by criminal networks.

For finance leaders at multinational companies dealing with suppliers or customers in emerging markets, the question is whether stablecoins can thread the needle—offering the speed and reach of informal systems while providing the compliance infrastructure that CFOs require. Deng's pitch is that they can, but the McKinsey data suggests the market has yet to prove it at scale.

The infrastructure mismatch Deng describes—ports and fulfillment centers running 24/7 while payment systems keep banker's hours—creates real costs for companies managing working capital across time zones. Whether stablecoins become the solution, or simply another option in an already fragmented landscape, may depend less on the technology than on whether regulators can harmonize frameworks across jurisdictions.