Stablecoins and Their Interaction with Data Centers: A Short Technical Exploration

1. Introduction

1.1 Purpose of the Paper This paper explores the intersection between stablecoins and data centers, focusing on how these digital assets influence infrastructure deployment, financing, and operations. Stablecoins—cryptocurrencies pegged to fiat currencies—have grown beyond speculative use to become essential tools in decentralized and global digital commerce, see here for examples and an excellent overview from USDC. As compute and storage demand surge due to AI, blockchain, IoT applications (and essentially everything else we do in life,) data centers play an increasingly critical role. Understanding how stablecoins interact with these systems is vital to designing resilient, agile infrastructure and solving now for future challenges.

1.2 Why It Matters Stablecoins enable near-instant, low-cost cross-border payments and because of this they have the potential to reshape how data centers are financed, contracted, and managed (especially in regions with capital controls or volatile banking systems). More than that though, they will influence how data centers run (and are paid) and how we need to prepare the infrastructure in terms of handling the load for all the other companies using stablecoins. With the rise of smart contracts and decentralized finance (DeFi), stablecoins are now embedded in infrastructure-as-a-service (IaaS) models and consumption-based billing (explored further in the points below). As pay per crawl services pop up, there’s also a chance stablecoins play a role, which would make them critical as we move more and more into an AI-dominated world (more on pay-per-crawl later).

2. Background

2.1 What Are Stablecoins? Stablecoins are digital assets designed to maintain a stable value relative to a reference asset, typically a fiat currency like the US dollar. The three primary categories are fiat-collateralized (e.g., USDC, USDT), crypto-collateralized (e.g., DAI), and algorithmic (e.g., Frax). It’s not important, but I have an extreme preference for fiat-collateralized. In any case, their key attributes—price stability, transparency, and on-chain programmability—make them attractive for financial applications where volatility is unacceptable. Here's how stablecoins are playing a role in the evolving financial landscape:

• Payment Infrastructure: Stablecoins are being adopted as a payment infrastructure, offering features like instant settlement and low costs, especially for cross-border transactions. Companies like PayPal and Stripe are integrating stablecoins into their systems to leverage these benefits, potentially improving margins for businesses.
• Infrastructure-as-a-Service (IaaS): While not explicitly stated as "embedded" in current IaaS models in the same way as traditional payment methods, stablecoins are enabling new forms of digital payments that could potentially impact IaaS billing in the future (as well as the costs associated with billing). The potential for stablecoins to facilitate automated and conditional payments through smart contracts opens possibilities for new billing models. I can’t fully wrap my head around how they may or may not facilitate pay per crawl, but I assume it’s possible because of the programmable nature of smart contracts. They can automatically execute transactions based on predefined conditions, so in theory they could enable microtransactions tied to specific digital actions—like each instance a bot or service crawls a webpage. In  pay-per-crawl models the payment could be automatically released per request/per dataset accessed (we can say goodbye to intermediaries and batch invoicing).
• Outside of pay-per-crawl, and back to more traditional consumption-based billing, stablecoins' programmability and real-time settlement capabilities make them suitable for the consumption-based billing models we are all familiar with. According to USDC.com, platforms using stablecoins can stream payments continuously, supporting real-time compensation that aligns with consumption patterns. This could be particularly relevant for other services that charge based on usage, allowing for a more seamless and efficient payment process.

Example: PayPal has used its stablecoin, PYUSD, for real-world B2B instances, including payments for cloud services.

These capabilities obviously introduce new efficiencies but also novel risks to the data center ecosystem.

2.2 Data Centers as Critical Infrastructure Modern digital life runs on data centers—they’re where apps live, where workloads get handled, and how everything and everyone stays connected and (ostensibly) productive around the world. As AI gets bigger and more services need to work in real time, data centers have to be more flexible, scalable, and spread out (edge). More and more, they're being run in hybrid or decentralized ways, which fits perfectly with the flexible, borderless nature of things like stablecoins. Basically, this means that the structure of modern data centers is starting to mirror the mass flow of data: distributed, adaptable, and not tied to one central authority or location.

This paper is taking a few liberties in jumping around in terms of its technical depth, but in an easier technical description (and probably more familiar) than some of the previous, this is why edge is becoming more important and prevalent: Imagine an AI company that trains models using data collected from users around the world—some in New York, others in Nairobi, and others in Tokyo. Instead of sending all that data to a giant centralized data center in one country, they use edge or decentralized data centers located closer to each user. This reduces latency (faster response times) and bandwidth costs.

3. Use Cases of Stablecoins in Data Center Ecosystems

Whilst this paper isn’t really about using stablecoins for DC payments, it is worth some consideration:

3.1 Payments for Compute and Storage: Platforms such as Akash Network and Filecoin enable users to rent decentralized compute and storage using stablecoins. These models bypass traditional payment rails and allow for global access without intermediaries. For data centers, this creates new customer segments and opens monetization channels. It’s also something we are talking about at Subsea Cloud (subsea, modular, typically edge data centers).  In other words, some platforms let users buy compute and storage with stablecoins, avoiding banks or traditional payment systems. This enables global, permissionless access to infrastructure. For data centers—like those at Subsea Cloud INC —it means new kinds of customers and revenue models, especially as edge and modular deployments align well with this decentralized approach.

3.2 Smart Contracts for Resource Allocation: Smart contracts (self-executing code on blockchains) can manage infrastructure usage terms, service-level agreements, and billing logic. When paired with stablecoins, they automate payments based on consumption metrics. This automation reduces administrative overhead, increases transparency, and supports new business models such as real-time metering and prepaid compute services.

With this in mind, we can ask the question: without a human in the loop, will more data be generated or less? The answer leans towards more. Here’s why:

• Smart contracts and automated systems operate continuously and in real time.
• They track consumption metrics, trigger payments, and enforce SLAs without human intervention.
• This creates a high volume of granular data (e.g., usage logs, transaction records, performance stats, etc.) that would otherwise be aggregated or handled less frequently by humans.

So, by removing the human-in-the-loop, we shift from periodic, manual data entries to constant, machine-level telemetry and execution, resulting in significantly more data being generated and logged. There’s no big surprise, but it has to be noted considering we (data center providers) will have to account for these loads.

3.3 Cross-Border Settlements As discussed, stablecoins enable rapid, low-cost settlements across borders, especially valuable in data center projects involving international partners or vendors. Unlike wire transfers, which incur fees and delays, stablecoin transactions settle in minutes, improving liquidity and cash flow management for infrastructure providers operating in multiple jurisdictions. This is data intensive and it is data intensive because every stablecoin transaction involves generating, validating, and recording data on a blockchain. When integrated with smart contracts, each payment will trigger logging, metering, and reporting actions tied to usage metrics like compute time, bandwidth, or storage. For the most part, this means constant data exchange between systems: tracking resource consumption, verifying contract conditions, and updating financial ledgers in real time. For data centers, supporting this volume of transactional and operational data demands robust, distributed digital infrastructure.

4. Financial and Operational Impact on Data Center Operations

4.1 Reduced Settlement Risk and Transaction Fees Traditional financial systems introduce friction in billing and payments due to latency, fees, and counterparty risk. Stablecoins streamline these processes, reducing failure points and enabling real-time reconciliation. This is particularly useful in colocation environments or consumption-based billing models, where microtransactions can be aggregated and settled efficiently.

4.2 Treasury and FX Implications: Holding stablecoins instead of fiat introduces new financial considerations. On one hand, they reduce exposure to local currency volatility and enable easier access to USD-based assets. On the other, they introduce custodial and liquidity risks, especially for algorithmic or less-regulated stablecoins, and must be actively managed. Treasury strategies may also include yield-bearing stablecoin instruments, adding new complexity. So, obviously holding stablecoins instead of fiat introduces new financial considerations. Here's how: it shifts financial operations from traditional banking environments into digital, often decentralized ecosystems. Custody becomes a technical function, not just a banking relationship, demanding secure wallet infrastructure and on-chain monitoring. Liquidity planning changes too, as redemptions and conversions depend on network conditions, not central bank guarantees. For organizations managing infrastructure or global operations, this means integrating blockchain analytics, adjusting compliance workflows, and building treasury policies that can react in real time.

Increased Transactional Data: Stablecoins are held and moved on blockchain networks, meaning every transaction is recorded immutably on-chain (Hello, data centers). Unlike traditional fiat banking, which batches or aggregates transactions, stablecoin transactions tend to be granular and high-frequency, especially when used for real-time payments, DeFi activities, or automated treasury operations. Each transaction contributes to a growing ledger of on-chain data, both public and private (e.g., internal logs, API calls).

Expanded Recordkeeping and Compliance Data: Because stablecoins are relatively new and often fall under emerging regulatory scrutiny, organizations must maintain detailed audit trails (wallet addresses, transaction hashes, timestamps, custodial arrangements, and counterparty data) to meet compliance and risk management standards. These records add layers of structured and unstructured data for internal use and external review.

Treasury and Risk Modeling Data: Holding stablecoins involves tracking price pegs, liquidity risks, protocol changes, and integration with other on-chain financial instruments (e.g., staking or liquidity pools). This leads to the generation of extensive treasury dashboards, risk assessments, and scenario simulations — all of which require computation, storage, and versioning over time.

Monitoring and Infrastructure Data: Stablecoin holdings necessitate active monitoring of wallet balances, smart contract positions, and oracle feeds. The supporting systems (monitoring tools, bots, security layers) themselves generate logs, alerts, and telemetry data that must be stored for operational and cybersecurity purposes.

In short: as organizations engage with stablecoins more deeply, especially in a financial or operational context, they produce more transactional data, security and audit logs, and financial records — all of which must be securely stored, often for years. This, in turn, amplifies demand for cloud storage, cold data archiving, blockchain node storage, and even edge storage in decentralized environments.

5. Technical Infrastructure Considerations

5.1 Integration with On-Chain Systems Data centers integrating stablecoin-based payment or governance systems must support wallet infrastructure, key management, and on-chain interfaces. This involves deploying APIs and middleware for transaction handling, permission, and audit trails. Reliable blockchain nodes and indexing services are also required to ensure transaction integrity and traceability.

5.2 Blockchain Node Hosting Data centers play a key role in hosting the nodes that validate and maintain the networks enabling stablecoins. Hosting Ethereum, Solana, or Cosmos validators requires high availability, network redundancy, and secure execution environments—aligning with the requirements of mission-critical financial infrastructure.

5.3 Latency, Throughput, and Network Resilience Stablecoin systems require resilient network connectivity for transaction propagation and confirmation. For use cases like automated billing or decentralized infrastructure management, minimizing latency and maximizing uptime are vital. This may drive more investment in edge nodes, redundant paths, and blockchain-specific infrastructure like RPC endpoints, for example (An RPC endpoint is a specific URL that acts as the entry point for interacting with a particular resource or function of a Remote Procedure Call).

6. Risks and Security

6.1 Counterparty and Protocol Risk Not all stablecoins are created equal (note: some personal bias in this section). Failures in algorithmic designs (e.g., TerraUSD) or mismanagement of reserves can introduce systemic risk to service providers accepting or holding such tokens. Protocol upgrades or governance changes may also affect token behavior in ways that introduce unpredictability (which we’ve all witnessed with other digital currencies). The one thing you can guarantee is that when an organization shifts its treasury holdings from fiat to stablecoins, a cascade of operational and technical changes will follow and, of course, each with a footprint inside the data center environment. These changes affect how systems are architected, how much data is generated and stored, and how the infrastructure is managed and any change (org. or gov. will result in this).

6.2 Compliance and KYC/AML Enforcement Regulators are increasingly scrutinizing the use of stablecoins, especially in the context of Know-Your-Customer (KYC) and Anti-Money Laundering (AML) requirements. Data center providers incorporating stablecoin billing or financing will have to ensure compliance with local financial laws.

6.3 Cybersecurity Implications There is an astounding amount of cyber security implications, but put as succinctly as possible: Stablecoin-enabled systems increase the attack surface of data center operations, from wallet infrastructure to smart contract vulnerabilities. As payment and control logic move on-chain, security practices must evolve to include smart contract auditing, multi-sig wallets, and secure oracle integration.

7. Future Outlook

7.1 Tokenized Infrastructure Billing Models (Data Centers) As Web3 and DePIN (Decentralized Physical Infrastructure Networks) models mature, tokenized billing will likely become standard. Stablecoins allow for microtransactions and pay-as-you-go billing with minimal overhead, creating new pricing models for edge compute, short-term deployments, or high-frequency access scenarios.

7.2 Integration with Sovereign Digital Currencies The emergence of central bank digital currencies (CBDCs) may complement or replace certain stablecoin functions. Integration with CBDCs could offer greater regulatory clarity while retaining many of the benefits of programmable, borderless digital payments. This would be especially relevant in public-private infrastructure partnerships.

Complement or Replace: CBDCs could take over some stablecoin functions—particularly in domestic or regulated cross-border payments—while still allowing stablecoins to serve niches like DeFi or private sector-specific use cases.

Regulatory clarity: CBDCs are issued and backed by central banks, so they inherently carry legal certainty and oversight that many stablecoins lack. This clarity is attractive for institutional and government-linked use.

Programmable and borderless payments: Like stablecoins, CBDCs can be designed to support programmability (via APIs or smart contract-like logic) and enable faster, lower-cost cross-border transactions.

Public-private infrastructure partnerships: These projects often span jurisdictions and involve complex payment structures. Using CBDCs could reduce friction, ensure compliance, and improve trust between partners and regulators.

8. Conclusion

Much the same as physical creations (like stock‑trading floors, buildings, and even entire city infrastructures) are now designed around algorithmic needs rather than human use, stablecoins are reshaping how data centers interact with global markets, offering new models for payment, governance, and deployment. While they introduce technical and regulatory complexities, the potential benefits (from operational agility to financial inclusivity and facilitating change) are significant. As infrastructure becomes increasingly dynamic and distributed, stablecoins will play a central role in enabling the next generation of digital services… and data centers will have to grow to support this and will likely be supported (financially) by this.

A copy of this will be available on Subsea Cloud's site in the coming weeks (subseacloud.com).