Why Institutions Don’t Want to Rely on a Single Stablecoin Payment Rail | Markets Outlook

Summary

Markets Outlook – March 10, 2026

Episode: Why Institutions Don’t Want to Rely on a Single Stablecoin Payment Rail

---

Brief Overview

In this episode of Markets Outlook by CoinDesk, the discussion dives into the risks and realities of stablecoin payment infrastructure for institutional users. Host B welcomes Kevin Latin, CEO of Borderless xyz, to explore the next phase of stablecoin adoption—"Stablecoin 2.0"—and the significance of Borderless's new partnership with Defense. The episode unpacks why relying on a single payment rail is outdated, the imperatives for redundancy and price discovery, and how the sector is evolving to reduce risk and increase resilience for banks, fintechs, and enterprise-scale payment processors.

---

Key Discussion Points & Insights

1. Risks of Relying on a Single Stablecoin Payment Rail

• Operational Risk: Large money movers (e.g., IBM, Western Union, Moneygram) face unacceptable risk if service downtime affects major corridors like Brazil.

  “If you’re someone like an IBM or someone like a Western Union... and someone has downtime and now all of a sudden Brazil is offline, that’s just not an acceptable level of risk.” — Kevin Latin (00:00)

• Vendor Lock-In: Relying on a solo provider creates a ‘single point of failure’—a risk no enterprise would accept in other business areas.

2. Evolution from Stablecoin 1.0 to 2.0

• Stablecoin 1.0: Proof of Concept Era:
  • Enterprises used black box solutions for fast onboarding and testing.
  • These solutions bundle everything and command a premium but lack flexibility and robustness.
  • Proof of concept helps companies learn where stablecoins fit—often in niche corridors rather than enterprise-wide.
• Stablecoin 2.0: Internal Ownership & Modular Stack:
  • The new model involves selecting best-in-class components for wallets, compliance, and local rails.
  • Companies demand systems not abstracted into a black box, but tailored and controlled directly.
• Necessity of Multi-provider Connections:
  • No provider is regulated everywhere; multiple connections are key for global reach, redundancy, and compliance.

3. The Borderless & Defense Solution

• Partnership Scope:
  • Borderless xyz, in partnership with Defense (major wallet provider), enables institutional stablecoin off-ramps that dynamically route payments across global providers.
  • Objective: Better price discovery, resilience, and reduced vendor lock-in for banks, fintechs, and enterprises.

  “If stablecoin infrastructure is going to fade into the background… then building on top of a network that is Borderless was the best product that they could bring to market…” — Kevin (01:55)

4. Advantages for Institutions

• Reliability: Automatic failover capabilities in case one counterparty or local rail goes down.
• Regulatory Agility: Ability to quickly adapt to jurisdictional changes and compliance scenarios, especially in emerging markets.
• Best Execution: Real-time routing across multiple providers enables better pricing and mitigates risk.

  “I can automatically failover if things go wrong. I can get better pricing by seeing best execution across different providers and I’m no longer stuck in that paradigm where any one counterparty can take down my entire business.” — Kevin (04:50)

---

Notable Quotes & Memorable Moments

• On Risk Management:

  “That would be insane in any other part of your business to have this single source of failure on a rail or a liquidity provider.” — Kevin (03:15)

• On Regulatory Change:

  “With any sort of regulatory change you have people on the right side of the change and people on the wrong side... So now, all of a sudden, if I'm connected to a network, I can automatically failover if things go wrong.” — Kevin (04:20)

• On Product Philosophy:

  “If stablecoin infrastructure is going to fade into the background... then building on top of a network that is Borderless was the best product...” — Kevin (01:55)

---

Timestamps for Key Segments

• [00:00] Risks of single rails in institutional payments (IBM/Western Union/Brazil example)
• [00:27] Introduction of guest Kevin Latin, CEO of Borderless xyz, and the Defense partnership announcement
• [01:02] Role of wallets in stablecoin infrastructure for enterprises
• [02:15] Evolution from stablecoin 1.0 (black box, proof of concept) to 2.0 (ownership, stack, redundancy)
• [03:15] Why vendor lock-in is unacceptable; need for best-in-class modularity
• [04:20] Handling regulatory changes and ensuring resilient global stablecoin payouts
• [04:50] Benefits of multi-provider routing: failover, price discovery, and risk mitigation
• [05:16] Close & congratulations on the launch

---

Conclusion

This episode details a critical market evolution: institutions moving away from monolithic, single-provider stablecoin payment solutions toward modular, multi-provider infrastructures. It captures how partnerships like Borderless and Defense are building the future of resilient, compliant, and vendor-agnostic stablecoin payment rails, turning what was once cutting-edge proof-of-concept tech into mature institutional-grade plumbing.

Transcript

[A]

If you're someone like an IBM or someone like a Western Union or a moneygram or these large money movers and someone has downtime and now all of a sudden Brazil is offline, that's just not an acceptable level of risk. So now all of a sudden you start to say, okay, well how can I use a network like Borderless to be able to connect to not just one counterparty in Brazil, but 2?

[B]

Let's bring in our next guest. Kevin Latin, CEO of Borderless xyz, joins us as his company partners with wallet infrastructure provider Defense to launch a new institutional stablecoin off ramp designed to route payments across multiple global providers. Aiming to improve price discovery, reduce vendor lock in and make stablecoin payouts to local fiat more resilient for banks, fintechs and enterprises.

[A]

Hey Kevin, thanks for having me on. Great to be here.

[B]

Thanks for being here. All right, let's talk about this partnership. Just lay a foundation for us. What's this going to allow institutions and banks to do that they couldn't do before?

[A]

Absolutely. So Defense is one of the largest enterprise wallet providers in the world and they sell very actively into large enterprises like IBM. They actually power the digital asset Haven product at IBM which is being sold into mid cap banks, other financial institutions as well as a lot of Enterprise Scale PSPs, FinTechs and others with their wallet infrastructure products. And what they've realized very early on is that for stablecoin adoption, the Wallet product is the perfect kind of yin and yang to on and off ramps. So if you can couple some sort of a wallet which lets you hold the asset with some sort of a product that lets you convert between stablecoins and local fiat currencies all around the world, that's the perfect infrastructure building block for these FinTechs, for these PSPs and for these financial institutions. And they did a tremendous amount of diligence across all the different players in the industry. Names that most people watching the show are probably familiar with and what they came up with at the end of the day is that if stablecoin infrastructure is going to fade into the background, which is where we think it goes, then building on top of a network that is Borderless was the best product that they could bring to market to their enterprise customers.

[B]

I know in the press release it says institutions shouldn't have to rely on a single payment rail or liquidity provider. You kind of started up packing that for me there. Just talk to me a little bit about why the stablecoin payments ecosystem has evolved this way and how this is changing the model.

[A]

We're seeing this shift from what I think of as stablecoin 1.0 to stablecoin 2.0. And stablecoin 1.0 is driven by a lot of proof of concepts, which makes a lot of sense. If you're a large enterprise that's been moving money around the world for years, you're not going to upend your entire infrastructure overnight because stablecoins have become this trendy thing. So what you want to do is you want to figure out what is a proof of concept that lets me validate whether and more interestingly where stablecoins do and don't play in my business with as little effort as possible. And the way that you do that is you typically get set up on some sort of like a black box. So you have a single vendor, that single vendor manages the entire stablecoin stack for you. They charge a great premium for it, but it gets you up and running really, really quickly. Then what you realize when you do, your proof of concept is that actually stablecoins have an interesting place in the business. Probably not as the underlying infrastructure for the entire business, but certainly in emerging markets corridors or in removing pre funding requirements, things like that. And then if you're a large enterprise, you don't want to rely at this stage on a single provider for your entire business. That would be insane in any other part of your business to have this single source of failure on a rail or a liquidity provider. And then you start to move into stablecoin 2.0, which is starting to own the stack internally. And you think about, okay, I need compliance products. Well, what are the best in class compliance products versus the ones that just got bundled into this black box? What are the best in class wallet products? Because now I need a way to hold these stablecoins versus just the one that was sold to me, abstracted as part of the black box. And then you start to think about, okay, well then how do I get access to local Rails? And that's where you start to have the issue around one, nobody is regulated in every country on earth. So you're going to need to connect to multiple providers to unlock multiple regions to begin with. And then most importantly, the reliability and the redundancy becomes super, super key here. So you have regulatory changes, especially in emerging markets where stable coins are so familiar. People get deplatformed and debanked, people have technical downtime, all these different things exist. And if you're someone like an IBM or someone like a Western Union or a Moneygram or these large money movers and someone has downtime and now all of a sudden Brazil is offline. That's just not an acceptable level of risk. So now all of a sudden you start to say, okay, well how can I use a network like Borderless to be able to connect to not just one counterparty in Brazil but two or three. And with any sort of regulatory change you have people on the right side of the change and people on the wrong side of the change. So, so now all of a sudden if I'm connected to a network of people I can automatically failover if things go wrong. I can get better pricing by seeing best execution across different providers and I'm no longer stuck in that paradigm where any one counterparty can take down my entire business.

[B]

Kevin, thanks so much for joining the show. It was a pleasure chatting with you and congratulations on the launch.

[A]

Thank you so much. Great to be here.