AI + Stablecoins
Stablecoins + AI agents are transforming finance by enabling always on autonomous systems that are redefining how value moves on the internet.
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Computers existed before the internet.
When the personal computer became popular in the 1990s, it operated marvelously independently. It revolutionized how we handled tasks and improved people’s lives.
Despite its capabilities, personal computers were isolated on their own.
They were capable of great work but limited in what they could do in a closed system.
But when the internet arrived, everything changed.
Suddenly, computers could connect to a vast world of information and people. They transformed from mere machines into portals of endless possibilities, allowing us to communicate, collaborate, and access an ocean of knowledge.
This innovation led to the modern technology-enabled world we live in today.
Money is now having its ‘personal computer connecting to the internet moment’.
Traditionally, money has served its purpose as a medium of exchange, a store of value, and a unit of account.
The inception of stablecoins supercharges the possibilities of money. It gives money all the benefits of the internet, including the rise of AI agents.
As Nic Carter put it, “Stablecoins are the Starlink for finance.”
Stablecoins, which now have a market cap of $200 billion & are already processing trillions in monthly transactions, have become the backbone of internet-native money.
By offering the stability of fiat currencies and the programmability of digital assets, stablecoins have laid the foundation for a global decentralized financial system accessible by autonomous systems.
AI agents are the systems that bring intelligence into the money equation.
They can analyze vast amounts of data, predict outcomes, and automate tasks instantly at an unprecedented scale. Integrating this with the seamless transfer of value that stablecoins offer unlocks an entirely new world of possibilities.
Imagine being able to leverage AI to make instant investment decisions using insights derived from global financial data, all while benefiting from the instant and secure transactions of stablecoins. You get a system that can assess risks, propose solutions, and execute transactions at the speed of the internet.
In this way, stablecoins and AI together create a dynamic duo that offers speed, intelligence, and efficiency, broadening the landscape of what's possible in finance and commerce.
AI can analyze data, execute tasks, and interact with blockchain protocols without human intervention. It is not just automating financial processes; it is completely transforming them.
Let’s dive in.
Good things come in threes
Stablecoins provide the scalability and reliability that AI agents need to operate autonomously.
They offer a level of stability and efficiency that traditional financial systems cannot match, creating the foundation for an entirely new era of financial automation.
Their benefits over traditional financial systems have led to their usage proliferating over the years.
Since their inception in 2014, stablecoins have processed over $60T in transaction volume and are currently being leveraged in nearly half of every transaction onchain.
While stablecoins have found a clear product-market fit and are primed for AI agents, the use cases will not come all at once but rather in waves of adoption.
In his essay, ‘The Role of Crypto in an Agentic Economy’, Robbie Petersen states that the adoption will happen in three distinct phases:
Phase 1 – Human-to-Agent Transactions (Present)
Phase 2 – Agent-to-Human Transactions (Emerging)
Phase 3 – Agent-to-Agent Transactions (Future):
Phase 1 is where we are closest to today.
Perplexity recently rolled out shopping features that make it easier for agents to purchase on a person’s behalf.
While this does not yet include the use of stablecoins, we’re not far off from companies starting to roll these types of features out:
I wrote about this in a previous essay, but Chamath Palihapitiya said this about how AI agents will make decisions on an episode of the All-In Podcast:
“AI is ruthless because it's emotionless. It was not taken to a steak dinner. It was not brought to a basketball game. It was not sold into a CEO. It's an agent that looked at a bunch of API endpoints, figured out how to write code to it to get done the job at hand.”
What Chamath meant when he made this statement is that AI agents will use the systems that are the most accessible and efficient to them and are not influenced by marketing, business development, or any factors that can influence human decisions.
They will choose the best form factor to transact on people’s behalf, and that form factor for financial activity will frequently be stablecoins.
Crossmint gets it and is building tools for AI agents to leverage stablecoins like USDC:
Phase 2 is rapidly gaining traction. In a thread, Robbie claims this about phase 2:
“The next phase involves agents autonomously initiating transactions with humans. This is already beginning in narrow domains – AI trading systems executing trades, smart home systems purchasing electricity at optimal rates through time-of-use pricing, and automated inventory management systems placing resupply orders based on demand forecasting.”
An example of this is MEV (Maximal Extractable Value) bots which have leveraged stablecoins to process $4.3B+ in total transaction volume over nearly 200 million transitions over the past three years.
MEV bots are automated programs that identify and capitalize on opportunities within blockchain transactions, such as arbitrage, liquidations, and front-running. Traditional MEV bots operate using rule-based algorithms, relying on pre-programmed strategies to monitor mempools, execute trades, and reorder transactions for profit.
These bots leverage machine learning to predict market trends, optimize transaction placement, adapt to changing conditions in real time, and showcase the evolution in the sophistication of crypto agents.
Stablecoins play a crucial role in bot operations, providing the stable, liquid medium needed to execute high-frequency, low-risk strategies at scale.
The increasing sophistication of these bots illustrates a larger trend: AI agents, bots, and autonomous systems are rapidly becoming dominant in blockchain ecosystems.
This is just one example of bots already using stablecoins at scale, and it shows how agents and bots have begun to impact markets broadly.
Phase 3, we’re just starting to see early signs of life.
In August of this year, Coinbase incubated the first AI-to-AI transaction using USDC.
Brian Armstrong has this to say about the interaction:
“AI agents cannot get bank accounts, but they can get crypto wallets. They can now use USDC on Base to transact with humans, merchants, or other AIs. Those transactions are instant, global, and free.”
Stablecoins provide the efficient, liquid, and permissionless medium that AI agents need to execute their tasks efficiently and reliably. Meanwhile, AI injects intelligence into blockchain operations, allowing for smarter, faster, and more efficient systems.
The implications of AI to AI transactions will be vast and far-reaching, leaving us to watch and see where they take us. For now, we can only speculate.
Stablecoins are primed for AI-driven use cases
One of the most compelling use cases for stablecoins today is programmable liquidity, where AI agents can dynamically access and deploy funds within an instant.
For example, so far in 2024, the global DeFi market has handled over $1.3 trillion in transaction volume, with stablecoins comprising a significant portion of that liquidity.
Companies like Velodrome and Aerodrome Finance are innovating as AMMs (automated market makers) by introducing a vote-escrow (ve) token model that incentivizes community-driven liquidity allocation.
This model ensures efficient capital deployment and scalability by integrating Layer 2 networks like Optimism and Base.
AI can further enhance these systems by enabling programmable liquidity and dynamically optimizing pool allocations, fee structures, and rewards based on market conditions and user behavior, driving more efficient and adaptive liquidity provisioning via stablecoins.
This all helps to further DeFi (decentralized finance), a market that has grown exponentially in the past few years and is on track to continue to grow exponentially.
VanEck predicts this about DeFi in 2025:
“DeFi hits all-time highs with $4 trillion DEX volumes and $200 billion total value locked, fueled by AI-related tokens, consumer-facing dApps, and tokenized assets driving liquidity and adoption.”
As DeFi continues to grow, so will AI usage.
Another area where stablecoins and AI agents are poised to make a massive impact is Cross-border payments.
Consider the global remittance market, which reached $883 billion in 2023 and is projected to grow to $913 billion by 2025.
Traditional remittances are also plagued by high fees, averaging around 6% globally, and delays can last several days.
Stablecoins are already disrupting this market because they can settle transactions instantly at negligible cost.
When layered with AI agents, the process becomes even more seamless: an AI agent can analyze exchange rates, identify the most cost-effective routes, and execute transfers autonomously.
This will help save consumers and businesses billions annually while improving the speed and accessibility of payments.
Jeremy Allaire touched on the potential for onchain AI agents during his keynote at Circle Forum Hong Hong while discussing, ‘How might AI agents operate on-chain with USDC.’
Stablecoins are uniquely positioned to be an optimal tool for AI agents to leverage for all of these use cases because they focus on programmability, trust, and transparency.
They provide an immutable record of every transaction onchain, ensuring that AI agents’ actions remain auditable and verifiable. This is especially critical as humans delegate increasingly complex tasks to these systems.
This programmable trust is essential for bridging the gap between human and machine economies.
AI agents, powered by this stable, programmable liquidity, are transforming these transactions into smarter, faster, and more cost-effective workflows. From optimizing DeFi strategies to automating global commerce, the synergy between stablecoins and AI agents is upgrading how value moves across systems.
The future of finance is upon us
As we enter a financial future where AI drives an increasing share of economic activity, stablecoins are emerging as the essential infrastructure for this transformation.
Their stability, speed, and accessibility make them the perfect monetary form factor for AI agents, enabling a smarter, more efficient, and more inclusive financial system.
Stablecoin-powered AI agents can help by simplifying complex financial tasks, making them available to anyone with an internet connection. By simply chatting with an AI agent, people will soon be able to create a wallet and transact in stablecoins without knowing all the complexities of finance.
For example, people lacking advanced financial knowledge can delegate portfolio management of any amount to AI agents that use stablecoins to navigate budget management and earn yield through stablecoins leveraging DeFi. All the users see is their stable savings account based in dollars generating passive interest.
These agents can automatically rebalance investments, optimize yields, or even secure loans, lowering the barriers to participating in decentralized finance behind the scenes while displaying a simple UI.
This has profound implications for financial inclusion, particularly in regions with limited access to traditional banking systems.
Efficiency is another major benefit we’re already beginning to see in payments.
AI agents reduce friction in financial workflows by automating transactions and decision-making processes. Consider that in 2023, the global payments industry processed $1.8 quadrillion in transaction value, generating $2.4 trillion in revenue largely from fees.
With their near-zero transaction costs, stablecoins enable AI agents to chip away at this “payment tax,” making transactions faster and cheaper for businesses and consumers alike.
For example, an AI agent managing payroll for a global workforce could use stablecoins to pay employees instantly, regardless of location, eliminating delays and hefty processing fees.
Perhaps, above all else, the most exciting implication is the creation of new economic models and markets that never existed due to inefficient financial markets.
With AI agents transacting autonomously using stablecoins, entirely new industries and ecosystems are beginning to emerge, and machine-to-machine economies, where autonomous devices and systems exchange value directly, are becoming a reality.
They have the potential to increase global economic productivity dramatically. Reducing inefficiencies and removing intermediaries frees up resources that can be reinvested into growth and innovation.
Together, stablecoins and AI agents are creating a smarter, faster, and more efficient global economy where humans and machines collaborate to unlock unprecedented levels of value and intelligent innovation.
The fusion of stablecoins and AI agents transforms how value moves, enabling autonomous economic systems that are faster, smarter, and more efficient than ever.
As this ecosystem grows, stablecoins will continue to serve as the backbone of this revolution, providing the stability and liquidity needed for AI agents to thrive.
This is just the beginning of what’s possible when programmable money meets intelligent automation, and the opportunities ahead are as vast as the digital economy itself.
Until our next adventure.
P.S. If you’re interested in learning more about stablecoins, check out my last essay:
Stablecoins | The Monetary Upgrade
Welcome to the latest edition of ‘The API Economy’ — thanks for reading.
Disclaimer: This month’s edition of The API Economy has no direct affiliation with Circle or any other company mentioned. I am employed by Circle at the time of this writing, but the views in this essay are my own personal opinions and don’t necessarily represent the views of Circle.
Note: Thanks to everyone who has consistently conducted quality stablecoin research, including but not limited to — Nic Carter, Rui, Jon Ma (and the entire Artemis team), Ryan Watkins, Sam Broner, Chamath Palihapitiya, Alex, QW, and Robbie Petersen.
*Special thanks to Mama Schroeder for editing this essay (any typos are on her 😊).
Sick visual.
Exceptional post Peter. I agree, artificial intelligence and stablecoins have both drastically reshaped the way society has and will continue to handle currency in the future. Paired with AI, stablecoins could become the new "norm" of currency, however, I believe this to be a decade down the road. On the contrary, Moore's law indicates technology is advancing at an exponential rate and in turn could result in stablecoins reaching "phase 3" quicker than I predict. Furthermore, given the rapidly accelerating advances in technology, there has been quit a bit of buzz around quantum computing. I am curious to as your opinion on quantum computing and the implications both positive and negative that quantum computing could have on stablecoins (or cryptocurrency in general). Looking forward to reading the future blog post (Quantum Computing + Stablecoins).
Thank you