Investors are ploughing money hand over fist into stablecoin startups. Fourteen companies building products around fiat-pegged cryptocurrencies have raised $537 million so far this year, according to DefiLlama data. That’s a five-fold increase from the $84 million raised in 2024.In July, stablecoin infrastructure venture OSL Group bagged the biggest round so far this year when the Hong Kong-based firm raised $300 million in equity funding to expand its global reach, per DefiLlama’s data.“There’s just a buzz around stablecoins,” Anna Strebl, CEO of stablecoin payment platform Confirmo, told DL News. She added that while getting funded has become relatively easy, “I don’t think it’s unfair hype.”Stablecoin frenzyThe amount raised highlights the crypto frenzy that has swept across markets this year, spurred by the industry’s key regulatory wins. Not only has US President Donald Trump supported the industry through executive orders and key government appointments, but he has also signed landmark stablecoin legislation, known as the Genius Act, into law in July. “It was basically a green light for corporate America,” Ron Tarter, CEO of stablecoin company MNEE, told DL News, saying the law legitimised the industry.The amount raised isn’t the only signal that things have changed for stablecoins. This week, the total value of stablecoins in circulation passed a record $290 billion. Coinbase analysts forecast that stablecoin supply will surpass $1 trillion by 2028.Another sign of the buzz around stablecoins can be seen in the stock market. Stablecoin issuer Circle’s $1 billion blockbuster initial public offering was executed in June. It’s trading at four times the value at the time of its IPO.While crypto lender Figure Technology also issued a stablecoin, DefiLlama categorises the firm as an RWA firm. Similarly, DefiLama defines Circle as a CeFi, or centralised finance, firm.Including Circle and Figure in the mix, the stablecoin sector has raised over $2.4 billion this year.Growing competitionNaturally, competition in the stablecoin market is intensifying. While companies like Circle and Tether may still maintain their hard-earned market dominance, they face competition on all sides. Not only has fintech giant Stripe announced plans to launch its own stablecoin network, but Wall Street players are also plotting similar stablecoin strategies.Institutions now view stablecoins as “building blocks of digital finance, turning dollars from passive storage into assets that both earn and settle value,” Evgeny Yurtaev, co-founder and CEO at wallet provider Zerion, told DL News.In June, Société Générale announced its intention to launch a US dollar-pegged stablecoin, and JPMorgan announced its own stablecoin offering called JPMD.Elsewhere, Bank of America, Wells Fargo and Citigroup are actively exploring launching their own stablecoins, too, according to The Wall Street Journal.Banks push back To be sure, stablecoins startups’ success hasn’t remained unchallenged. In August, several banking lobby groups issued a stern warning. They stated that the Genius Act granted crypto companies an unfair advantage, potentially draining over $6 trillion in deposits from lenders.Their argument? Though lenders will be able to issue stablecoins, they’ll be barred from paying any interest to holders. Crypto companies have no such rule holding them back, they say.The industry, spearheaded by Coinbase’s Chief Policy Officer Faryar Shirzad, has hit back against the banking backlash. “Deposit erosion is a myth,” Shirzad wrote in a blog, suggesting that those financial institutions are simply trying to protect their “$187 billion annual swipe-fee windfall.”You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.Investors are ploughing money hand over fist into stablecoin startups. Fourteen companies building products around fiat-pegged cryptocurrencies have raised $537 million so far this year, according to DefiLlama data. That’s a five-fold increase from the $84 million raised in 2024.In July, stablecoin infrastructure venture OSL Group bagged the biggest round so far this year when the Hong Kong-based firm raised $300 million in equity funding to expand its global reach, per DefiLlama’s data.“There’s just a buzz around stablecoins,” Anna Strebl, CEO of stablecoin payment platform Confirmo, told DL News. She added that while getting funded has become relatively easy, “I don’t think it’s unfair hype.”Stablecoin frenzyThe amount raised highlights the crypto frenzy that has swept across markets this year, spurred by the industry’s key regulatory wins. Not only has US President Donald Trump supported the industry through executive orders and key government appointments, but he has also signed landmark stablecoin legislation, known as the Genius Act, into law in July. “It was basically a green light for corporate America,” Ron Tarter, CEO of stablecoin company MNEE, told DL News, saying the law legitimised the industry.The amount raised isn’t the only signal that things have changed for stablecoins. This week, the total value of stablecoins in circulation passed a record $290 billion. Coinbase analysts forecast that stablecoin supply will surpass $1 trillion by 2028.Another sign of the buzz around stablecoins can be seen in the stock market. Stablecoin issuer Circle’s $1 billion blockbuster initial public offering was executed in June. It’s trading at four times the value at the time of its IPO.While crypto lender Figure Technology also issued a stablecoin, DefiLlama categorises the firm as an RWA firm. Similarly, DefiLama defines Circle as a CeFi, or centralised finance, firm.Including Circle and Figure in the mix, the stablecoin sector has raised over $2.4 billion this year.Growing competitionNaturally, competition in the stablecoin market is intensifying. While companies like Circle and Tether may still maintain their hard-earned market dominance, they face competition on all sides. Not only has fintech giant Stripe announced plans to launch its own stablecoin network, but Wall Street players are also plotting similar stablecoin strategies.Institutions now view stablecoins as “building blocks of digital finance, turning dollars from passive storage into assets that both earn and settle value,” Evgeny Yurtaev, co-founder and CEO at wallet provider Zerion, told DL News.In June, Société Générale announced its intention to launch a US dollar-pegged stablecoin, and JPMorgan announced its own stablecoin offering called JPMD.Elsewhere, Bank of America, Wells Fargo and Citigroup are actively exploring launching their own stablecoins, too, according to The Wall Street Journal.Banks push back To be sure, stablecoins startups’ success hasn’t remained unchallenged. In August, several banking lobby groups issued a stern warning. They stated that the Genius Act granted crypto companies an unfair advantage, potentially draining over $6 trillion in deposits from lenders.Their argument? Though lenders will be able to issue stablecoins, they’ll be barred from paying any interest to holders. Crypto companies have no such rule holding them back, they say.The industry, spearheaded by Coinbase’s Chief Policy Officer Faryar Shirzad, has hit back against the banking backlash. “Deposit erosion is a myth,” Shirzad wrote in a blog, suggesting that those financial institutions are simply trying to protect their “$187 billion annual swipe-fee windfall.”You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.