Amid accelerating demand for digital dollars, Coinbase stablecoin initiatives are expanding as the exchange begins backend testing of a new token called USDF.
Coinbase enables USDF for internal testing on its exchange
Coinbase has activated a new USDF token as a Coinbase Custom Stablecoin for backend operational testing on Coinbase Exchange. However, the company stressed that this early-stage test environment does not yet support trading, deposits, or withdrawals for the asset.
The exchange said on Tuesday, via its Coinbase Markets channel, that the feature is strictly limited to internal infrastructure checks. Moreover, Coinbase indicated that further updates will be announced as testing progresses, signaling a phased rollout strategy rather than an immediate product launch.
The move suggests that the corporation may be preparing to broaden its stablecoin offering beyond USDC, which it co-issues with Circle. That said, the new development does not alter existing USDC services for customers, which remain central to Coinbase’s current product stack.
Custom stablecoins and the USDF development pipeline
A fresh Coinbase Custom Stablecoin, labeled USDF, has now been enabled on the exchange solely for operational testing. Please note that this phase is backend-only. Trading, deposits, and withdrawals remain unavailable, and Coinbase has urged users to wait for future announcements before expecting any direct access.
Coinbase introduced its Coinbase Custom Stablecoins framework in December of last year as part of an effort to help institutions move value across blockchains. The program is designed to let companies transfer funds between supported networks more easily and earn rewards tied to token activity, improving both liquidity and incentives.
The exchange positioned this infrastructure as a core component of its broader product expansion. Moreover, the same framework is now supporting the development of USDF during its backend testing phase and enabling the issuance of dollar-backed tokens that are fully collateralized by USDC, reinforcing a conservative, reserve-based design.
The cryptocurrency infrastructure platform Flipcash is building the USDF stablecoin specifically for this test program. According to Coinbase, the asset is expected to be accessible in early 2026, with USDF set to serve as the main stablecoin within the Flipcash app at launch, underpinning payments and transfers.
However, Flipcash is only one example of how Coinbase’s custom-framework is being adopted. A self-custody wallet operating on Solana, which uses the same architecture as Solflare, and the decentralized finance platform R2 are also working with Coinbase to create their own branded stablecoin products using the same infrastructure.
This steady stream of pilot projects indicates that the coinbase stablecoin program is evolving from a single-token focus to a multi-partner, multi-asset ecosystem. As more brands experiment with tailor-made tokens, Coinbase appears to be positioning itself as a white-label backbone for stable-value assets.
USDC revenues highlight stablecoin market growth
Stablecoins remain a key component of Coinbase’s long-term business model. The exchange continues to maintain a close partnership with Circle, the issuer of USDC, which is among the most widely used dollar-pegged tokens in the global cryptocurrency market.
Under this arrangement, Coinbase receives a share of interest income and associated fees linked to USDC activity. Moreover, this revenue stream has grown into a significant earnings pillar for the exchange, especially as interest rates and on-chain usage have risen in tandem.
In the fourth quarter of last year, Coinbase reported roughly $332.5 million in revenue tied to stablecoins, marking a 38% increase. This was largely driven by USDC-related interest and a reported retail trading volume of $41 billion, highlighting how stable-value tokens can generate substantial income even outside of pure trading spreads.
Currently, on-chain data from Coingecko shows that the global stablecoin market stands at about $312.6 billion, with $106,893,512,390 in 24-hour trading volume. That said, despite this rapid expansion, the sector remains highly sensitive to policy developments and macroeconomic shifts.
Regulatory pressure rises alongside stablecoin adoption
While usage continues to rise, stablecoin growth faces mounting regulatory scrutiny worldwide. The U.S. Department of the Treasury‘s Q1 2025 report projected that U.S. dollar-pegged stablecoins could reach an aggregate market valuation exceeding $2 trillion by 2028, underscoring their potential systemic importance.
Earlier this month, research from Bloomberg Intelligence forecast that global stablecoin payment flows might hit $56 trillion by 2030, assuming a compound annual growth rate of 81%. However, regulators and policymakers remain cautious about both the speed and structure of this expansion, warning about risks to financial stability and consumer protection.
In December of last year, the International Monetary Fund (IMF) warned that large-scale stablecoin adoption could disrupt existing financial systems and growth models. Moreover, the IMF argued that a patchwork of national regulatory regimes is creating structural roadblocks that both weaken oversight and complicate cross-border payments.
According to the IMF, stablecoins can move across jurisdictions far faster than regulators can respond because of these fragmented legal frameworks. This makes it difficult for authorities to monitor reserves, redemptions, and liquidity management in real time, and it further complicates enforcement of anti-money laundering standards.
The fund cautioned that this environment encourages regulatory arbitrage, as issuers may base operations in lightly supervised jurisdictions while continuing to serve users in markets with stricter rules. That said, multilateral bodies are increasingly calling for harmonized standards to close these gaps.
Transaction volumes surge as new rules emerge
Despite these concerns, on-chain usage continues to rise sharply. Data compiled by Artemis Analytics showed that global stablecoin transaction value surpassed $33 trillion in 2025, a 72% increase compared with the previous year, underscoring robust demand for blockchain-based dollar rails.
USDC emerged as the leading stablecoin by transaction volume, processing around $18.3 trillion. Meanwhile, Tether‘s USDT handled approximately $13.3 trillion in transfers, even as it continued to dominate by market capitalization with a reported size of $187 billion.
This surge in activity has coincided with new legislative frameworks. In the United States, the passage of the GENIUS Act in July 2025 established the first comprehensive regulatory regime for payment-focused stablecoins, offering clearer guidance on reserves, reporting, and issuer licensing.
Industry leaders argue that this kind of legal clarity could accelerate mainstream adoption. Tether co-founder Reeve Collins said that regulations such as the GENIUS Act open the door for stablecoins to gain broader global acceptance by reducing uncertainty for both issuers and institutional users.
Outlook for Coinbase and the broader stablecoin ecosystem
For Coinbase, the launch of USDF backend testing underscores how exchanges are evolving from pure trading venues into infrastructure providers for programmable dollars. Moreover, by supporting a mix of external partners like Flipcash, Solana-based wallets, and DeFi platforms, the company is embedding itself deeper into the stablecoin value chain.
If regulatory frameworks continue to mature while demand for digital dollar rails grows, USDC-collateralized tokens such as USDF could become a larger share of global payments and on-chain settlements. However, scaling safely will require that infrastructure providers like Coinbase align technical innovation with increasingly strict oversight standards.
In summary, USDF’s controlled rollout, Coinbase’s growing stablecoin revenues, and rising global transaction volumes all point toward a more institutionalized market. How regulators, issuers, and platforms coordinate over the next few years will likely determine whether stablecoins fully transition from niche crypto tools to mainstream financial infrastructure.
