[Opinion] Asian Stablecoins That Bypass the Dollar Could Reshape the FX Order

Asia’s foreign-exchange market has long been a core pillar of the global financial system. Korean companies settle with suppliers in China, Japanese trading houses pay partners in Vietnam, and Southeast Asian workers send money home to support their families. All of those flows run on FX infrastructure. According to the Bank for International Settlements, average daily global foreign-exchange trading reached $9.6 trillion in April 2025. Nearly 30% of that volume passes through Asia’s major FX hubs.

The problem is that the system supporting those vast flows still relies on a structure built decades ago. There was a time when sending a text message cost extra if it exceeded a character limit. That now feels inefficient and outdated, yet finance still works in much the same way. Information moves in real time, but money still moves slowly through correspondent banks, prefunded accounts and multiple currency conversions. Even transactions between Asian currencies often remain tied to a system that uses the US dollar as an intermediary.

Money moving from the Korean won to the Japanese yen, or from the Singapore dollar to the Philippine peso, is still typically settled through a dollar hub. That structure creates additional conversion costs, settlement delays, operating expenses and liquidity inefficiencies. The World Bank puts the average cost of global remittances at more than 6%. Those inefficiencies are not just a problem for financial institutions. They are also a daily cost borne by individuals and businesses. Many fintech services may offer sleek digital interfaces, but they still run on legacy back-end financial networks. The user experience looks modern, while the settlement structure often remains stuck in the past.

Stablecoins have helped address part of that problem, and the market has already grown to more than $300 billion. Blockchain-based payment infrastructure has dramatically increased the speed of moving money. It is gaining traction in global remittances and digital payments as a faster, cheaper option. Yet almost 99% of stablecoins in circulation are still dollar-based. Payment technology has evolved, but the currency structure has changed little.

The next step Asia’s financial markets need is not faster dollar transfers. The key is direct settlement between local currencies. If regional currencies such as the won, yen, Singapore dollar and peso are issued as digital assets and can move and be exchanged directly without passing through the dollar, Asia’s FX structure could change fundamentally.

Still, that shift is unlikely to be achieved by any single stablecoin issuer or blockchain. Each country has its own currency regime, regulatory system, payment infrastructure and operating standards for financial institutions. For local-currency stablecoins to become part of real FX infrastructure, the region must move beyond isolated experiments by individual countries or companies. It needs a cooperative framework that links policy, technology and liquidity discussions across markets.

That is where the Asia Stablecoin Alliance, or ASA, comes in. ASA is a consultative body that connects builders, institutions and participants in regulatory discussions to accelerate stablecoin adoption in Asia. For stablecoins to move beyond crypto trading and become a foundation for payments, remittances, foreign exchange and the distribution of tokenized assets, the region will need not only technical connectivity but also coordination across rules and markets. To that end, ASA is examining how regulatory systems differ across Japan, Hong Kong, Singapore and South Korea, and where those frameworks can connect. It is also identifying and sharing real-world use cases in payments, remittances and corporate settlement across Asia to help the market learn faster.

ASA Conference 2026, to be held this year, is another forum for that discussion. More than 700 industry participants from banks, institutions and asset issuers attended last year’s ASA conference to discuss the potential of Asian stablecoins. This year, the focus will become more concrete. ASA Conference 2026 will compare regulatory environments and digital-money models across South Korea, Japan, Hong Kong, Singapore and Southeast Asia. It will also examine the conditions needed for local-currency stablecoins to expand into payment and FX infrastructure.

At the same time, once stablecoins are adopted, the technical foundation needed to distribute and use them becomes critical. For local-currency stablecoins to be used in payments, foreign exchange and corporate treasury operations, they must be able to move across multiple blockchains and financial applications rather than remain isolated on a single chain. Interoperability infrastructure such as LayerZero provides the foundation for that distribution. It could also play an important role in the use of a broader range of digital assets, including gold, government bonds, money-market funds and tokenized securities.

If stablecoins were the first act of dollar-based payment innovation, the second act is direct foreign exchange between Asian local currencies. The competition no longer ends with issuing more stablecoins and tokenized assets. The question is who will first build the financial distribution infrastructure that allows Asian stablecoins such as the won, yen, Singapore dollar and peso to move most efficiently across borders and networks. The shift in the FX order has already begun.

Lim Jong-kyu, Head of Asia at LayerZero