The dollar detour: why non-USD stablecoins matter for settlement

Nearly all stablecoin value in circulation is pegged to the US dollar. For a business in Dubai paying a supplier in Singapore, that creates a structural problem: dirhams must become US dollars, US dollars must cross chains, and US dollars must become Singapore dollars. That means two conversions, two spreads, and a dependency on a currency that neither side actually uses. We call this the dollar detour, and removing it is the single biggest unlock left in stablecoin settlement. Non-USD stablecoins, pegged to dirham, euro, Singapore dollar, and beyond - are how it gets removed.

What is the dollar detour?

Stablecoin rails made cross-border transfers fast. They did not make them currency-native. When both endpoints of a payment sit outside the dollar zone, today's default flow looks like this:

1. Convert local currency to USD - one FX spread.

2. Move USD as a stablecoin - fast and cheap; this leg works.

3. Convert USD to the destination currency - a second FX spread.

The transport leg improved dramatically, but the conversion legs doubled. A payment between two non-dollar economies pays dollar tolls in both directions in spreads, liquidity costs, and settlement dependencies routed through a third currency. The irony is sharp: technology built to disintermediate correspondent banking recreated the dollar's correspondent role on-chain.

Why are almost all stablecoins dollar-denominated?

Three reasons, all rational and all historical. First, liquidity begets liquidity: the earliest stablecoins were dollar tokens serving crypto trading, and every venue, market maker, and integration accumulated around them. Second, reserves: dollar stablecoins hold US Treasuries, the deepest and most yield-bearing reserve asset on earth, which makes dollar issuance the most profitable issuance. Third, until recently, regulation: for years there was simply no licensing regime under which a regulated dirham or euro token could exist at scale.

The result: USDT and USDC dominate on-chain settlement volume (Chainalysis measured USDT alone processing on the order of $700 billion in a typical month) while everything non-dollar remains a rounding error in supply terms.

But the third reason has expired.

Licensing regimes for local-currency stablecoins now exist, and issuers are activelly using them.

What does the double conversion actually cost?

Illustrative economics for an AED 1,000,000 supplier payment to Singapore (figures are indicative ranges, not quotes):

Two honest observations:

First, the dirham's dollar peg keeps the first leg cheap. For AED flows, the detour tax shows up mostly in the second conversion, the doubled counterparty set, and the extra exposure. For non-pegged currencies across the region's trade partners, like lira, pounds, francs; both legs price at full spread and the gap widens sharply.

And second, one conversion instead of two is not only cheaper; it is operationally simpler: one exposure, one counterparty relationship, one thing to reconcile. For context on how much cost matters at the retail end of these flows: the World Bank puts the global average cost of sending $200 above 6%. B2B flows are cheaper but structurally identical and every unnecessary conversion is margin surrendered to the detour.

Policymakers are pulling in the same direction: governments across Asia and the Gulf have spent recent years promoting local-currency settlement in bilateral trade to reduce dollar dependency, and regulators like Singapore's MAS built dedicated stablecoin frameworks precisely so local-currency tokens could exist under supervision. Local-currency rails are policy direction, not just crypto thesis.

Which non-USD stablecoins exist today?

More than most people think — and the regulated ones cluster in exactly two places: the EU and the Gulf.

Again, two observations:

The euro tokens prove the demand curve: once MiCA created a lawful home, euro stablecoin volume grew explosively from a tiny base.

And the dirham is the quiet outlier - a non-G7 currency with multiple licensed issuers under a dedicated central-bank framework, live acceptance, and more banks in the approval pipeline.

What has to happen for non-USD settlement to work at scale?

Issuance was the prerequisite, and it's arriving. Regulation was the blocker, and in the UAE and EU it has cleared. What remains is the hard part: liquidity and interoperability.

Non-dollar pairs are thin. AED/SGD on-chain liquidity does not remotely resemble USDT/USD liquidity, and pretending otherwise is how settlement fails at size. Bridging that gap takes regulated conversion infrastructure: licensed venues, committed market makers, smart routing that splits flow across pools, and, where direct pairs are too thin, optimized routing that minimizes rather than maximizes the dollar leg. The dollar detour disappears gradually: first shortened, then optional, then gone.

And every new currency token multiplies the interoperability matrix . More tokens × more chains × more venues. That N×N problem is the reason settlement infrastructure exists as a category, and it's the layer we're building at Thiqwave: non-USD pairs as first-class citizens, not exotic add-ons to a dollar system.

The next wave of settlement will be denominated in dirhams, euros, and other local currencies as much as in dollars. The rails just have to catch up to the money.

Frequently asked questions

What is a non-USD stablecoin?
A stablecoin pegged 1:1 to a currency other than the US dollar, for example EURC (euro), AE Coin (UAE dirham), or XSGD (Singapore dollar), backed by reserves in that currency and, increasingly, issued under a dedicated licensing regime.

Why does it matter what currency a stablecoin is pegged to?
Because every mismatch between the payment's currencies and the token's currency adds a conversion: a spread, an exposure, and a dependency. Settling in the currencies businesses actually hold removes the dollar detour.

Is there a regulated dirham stablecoin?
Yes, several. AE Coin received the CBUAE's first full licence under the Payment Token Services Regulation in December 2024, Zand Bank launched an AED token in 2025, DDSC from First Abu Dhabi Bank launched in 2026 and further bank issuers have approvals in progress.

Why is stablecoin liquidity concentrated in dollars?
Network effects (trading infrastructure grew around dollar tokens), reserve economics (US Treasuries), and a historical absence of licensing regimes for other currencies. The first two persist; the third is gone.

Sources

• Chainalysis, 2025 Geography of Cryptocurrency Report

• Forbes, "Non-Dollar Stablecoins Hit $1.2 Billion" (Mar 2026) · Stablecoin Insider, EURC Q1 2026 report

• World Bank, Remittance Prices Worldwide · World Bank remittance flows 2024

• CBUAE, Payment Token Services Regulation (2024) · AE Coin licence (Dec 2024) · Zand AED (Nov 2025)

• EU Regulation 2023/1114 (MiCA) · JPYC launch (Oct 2025)