Mega Financial Holding Chairman Dong Ruibin bluntly stated at the Yushan Science and Technology Association Forum that banks see no advantage in issuing stablecoins. He cited data from Mega Bank's test of USDT cross-border remittances across 25 overseas branches: 14 failed due to local regulatory restrictions, a success rate below 60%. He warned that if innovation is done for its own sake with no users, it becomes a lesson like NFTs.
Three fatal flaws detailed
First, Taiwan's domestic payment scene is already mature. Local transfers arrive in two minutes with fees of zero to 15 NTD. Visa and Mastercard dominate retail payments, and even credit card business is struggling. Stablecoins have no entry point for rigid demand or fee revenue.
Second, cross-border remittances. While stablecoins offer speed (20 minutes) and lower fees than bank wire transfers (420–1,100 NTD), Dong questioned: who would use a Mega-issued USD stablecoin? Mega lacks brand recognition in the U.S. and Japan. The stablecoin market is already dominated by Tether's USDT with 61% market share, a winner-takes-all scenario.
Third, regulatory requirements. Major economies, including the U.S., EU, UK, Singapore, Hong Kong, UAE, and Japan, impose 100% fiat reserve requirements on bank-issued stablecoins. For every $1 deposited, the bank must freeze $1, killing the traditional lending spread. Dong said flatly: with 100% reserve, we can't pay any interest, making it impossible to attract users.
A global banking dilemma
This is not unique to Mega. The Payments Association estimates that if 10% of cross-border payments shift to stablecoins, banks would lose tens of billions in fee revenue annually. Banks are caught between investing in costly tests and losing customers to Tether.
Tether itself holds about 20% of its reserves in non-cash assets including secured loans, bitcoin, and precious metals, falling short of 100% fiat backing. Regulated banks would face stricter transparency audits, essentially competing with a lightly regulated rival using a higher-cost product.
Test data draws skepticism
Mega Bank's test data claimed bank wire transfers take two hours with fees of 420–1,100 NTD, while stablecoin transfers take 20 minutes with a fee of 2 USDT plus 0.2% transaction fee. Crypto communities quickly questioned which chain needs 20 minutes for confirmation, and whether the 0.2% fee applies to fiat-to-stablecoin conversion. In practice, BNB, Tron, and most ETH Layer2 transfers confirm within one minute with native fees under 0.1 USDT.
Taiwan's Financial Supervisory Commission has announced draft regulations for stablecoins, expected by June 2026, with issuance limited to financial institutions. But the banking sector's honest answer from Dong remains: will anyone use a bank stablecoin? Will it make money? In Taiwan, both answers are unclear.