Bridging TradFi and Digital Finance: Why Multi-Asset Settlement in Stablecoins is the Next Institutional Imperative
Author: Tianwei Liu, CEO and Co-Founder, StraitsX
As capital markets evolve under the pressure of digital transformation, financial institutions are increasingly rethinking the architecture of value exchange. Stablecoins, once viewed primarily through the lens of retail crypto adoption, are now entering a more consequential phase: serving as infrastructure for institutional settlement across multiple asset classes.
The shift from experimentation to implementation reflects a maturing view of what digital money can accomplish when embedded within the core functions of global finance. The global economy no longer moves in silos. Cross-border payments, B2B settlement, FX trading, and post-trade reconciliation are no longer discrete functions but interdependent workflows that demand speed, clarity, and programmability. And yet, much of the plumbing behind these flows remains firmly rooted in decades-old systems. Manual reconciliation, limited operating hours, and multiple intermediaries continue to inflate cost and complexity.
From speculation to settlement: The institutional rise of stablecoins
Stablecoins offer a viable path forward. Fully reserved stablecoins like XSGD and XUSD are increasingly used to settle institutional flows in real time, allowing value to move seamlessly across counterparts, currencies, and countries. Unlike traditional fiat systems, stablecoins can embed logic directly into the payment layer, enabling programmable payables, escrow conditions, and automated settlement across enterprise systems. This is no longer theoretical.
In Asia, we are seeing licensed FX desks and fund managers use XSGD to settle spot FX trades with their regional counterparts, replacing multi-day processes with near-instant, blockchain-based transactions. Across Southeast Asia, corporates are deploying programmable stablecoins like XUSD and XIDR for just-in-time intra-group funding, unlocking real-time treasury flows that operate around the clock, not around banking hours.
This evolution is not limited to Asia. In Europe, pilots are already underway exploring how institutional-grade stablecoins can be used to facilitate cross-currency settlement and post-trade clearing, particularly in tokenised asset markets. The XRP Ledger (XRPL), for example, has become a key platform for these developments, supporting real-time settlement for tokenised FX and enabling new levels of automation in treasury operations. XRPL’s low-latency environment and built-in decentralised exchange (DEX) offer a powerful foundation for executing and settling multi-asset trades with institutional-grade transparency and finality.
Settlements reimagined: From back-office task to strategic economic lever
At the core of this shift is a simple truth: settlement is no longer just a back-office function. It is a strategic layer that directly affects liquidity, risk management, and customer experience. Institutions are beginning to realise that stablecoins can offer far more than a static representation of fiat. They are tools to program money itself.
But infrastructure alone is not enough. As this transition unfolds, the need for regulatory clarity and trust becomes even more critical. A stablecoin is not credible because it exists on-chain. It earns credibility because it is fully backed, redeemable, and accountable to the same, if not stricter, standards as fiat. Stablecoin issuers must operate with the same rigour expected of financial institutions, robust reserve management, regular attestation, redemption mechanisms, and a clear legal framework that withstands scrutiny. Without these foundations, no amount of technological efficiency will convince compliance officers or institutional treasurers to take the leap.
Credibility by design: Why trust is the real innovation
This is where regulated stablecoin issuers play a critical role. To meet institutional expectations, stablecoins must be fully backed by fiat, subject to robust oversight, and aligned with clear regulatory frameworks that ensure redeemability, transparency, and accountability. The most credible issuers are those that not only maintain strict reserve standards and attestation requirements but also offer multi-chain interoperability, enabling stablecoins to move seamlessly across blockchain networks, without compromising trust in the underlying assets.
What we are witnessing is the convergence of two financial worlds: the programmability and composability of blockchain-based finance, with the institutional-grade controls and safeguards of traditional banking. The outcome is a new category of financial infrastructure – multi-asset, always-on, and designed to operate at the speed of business.
Orchestration at scale: From pilot projects to institutional default
For financial institutions exploring their next phase of digital transformation, the question is no longer if stablecoins will play a role in institutional settlement, but how. The frameworks, platforms, and partners are already in place. The challenge now is one of orchestration: integrating programmable stablecoins into the core of treasury and payment systems, not as experiments but as the new default.
In the coming years, the institutions that embrace this shift early will have a structural advantage. They will unlock not just cost savings, but strategic agility in how capital moves across borders, systems, and asset classes. And they will help define the next generation of financial infrastructure, not through disruption, but through convergence.
