Step 6: Stablecoin Selection & Settlement

Mandatory

One of the most critical decisions in the tokenization process is selecting a stablecoin for settlements. Stablecoins are digital assets pegged to traditional currencies like USD or EUR, providing price stability while enabling seamless blockchain transactions.

In the tokenization process, stablecoins are used to settle transactions, meaning that when an investor buys tokenized assets, payments are made using stablecoins. These transactions are cleared and recorded on a single blockchain ledger, ensuring transparency, security, and efficiency.

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Why Are Stablecoins Important?

• Price Stability – Unlike cryptocurrencies like Bitcoin or Ethereum, stablecoins are pegged to real-world currencies, reducing volatility.

• Fast & Secure Transactions – Settlements happen instantly on the blockchain without delays caused by banks.

• Global Accessibility – Investors from different countries can transact in a unified digital currency without needing traditional banking infrastructure.

• Single Ledger Settlement – All transactions are recorded on a single blockchain, eliminating intermediaries and ensuring full transparency.

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Available Stablecoin Options

When tokenizing an asset, you must select which stablecoin will be used for transactions and settlements. Below are the available options:

1. USDC (USD Coin)

   1. Pegged To: US Dollar (1 USDC = 1 USD)

   2. Issuer: Circle, a regulated fintech company based in the U.S.

   3. Best For: Companies that prefer a highly regulated and transparent USD-backed stablecoin.

2. USDC & USDT (Tether)

   1. USDC: Explained above.

   2. USDT (Tether)

      1. Pegged To: US Dollar (1 USDT = 1 USD)

      2. Issuer: Tether Limited, one of the first stablecoin providers.

   Best For: Companies that want access to the two largest USD-backed stablecoins.

3. EURC (Euro Coin)

   1. Pegged To: Euro (1 EURC = 1 EUR)

   2. Issuer: Circle, the same company behind USDC.

   Best For: Businesses operating in the Eurozone, ensuring seamless transactions in EUR.

4. EURS & EURC (Euro Stablecoins)

   1. EURS (Stasis Euro)

      1. Pegged To: Euro (1 EURS = 1 EUR)

      2. Issuer: Stasis, a European fintech firm.

   2. EURC (Euro Coin)

      1. Already explained above.

   3. Best For: European companies or projects dealing primarily in EUR transactions.

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How Does the Settlement Process Work?

When an investor purchases tokenized assets, the payment is made in the selected stablecoin. The transaction is then:

1. Verified on the Blockchain – Ensuring security and immutability.

2. Cleared on a Single Ledger – The system records the transaction on the chosen blockchain (Ethereum, Arbitrium, etc.).

3. Token Transfer Completed – The stablecoin payment is received, and the corresponding tokenized asset is transferred to the investor.

The process eliminates intermediaries, reducing costs and ensuring real-time settlements.

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Finalizing Stablecoin Selection

Choosing the right stablecoin depends on:

• Your business’s currency preference (USD or EUR)

• Investor demand and market liquidity

• Regulatory compliance in your jurisdiction

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