War What It Is: Banks Dump Commodity Traders Over Iran Risk, USDT Steps In to Fill the Void

The geopolitical mess involving Iran is doing what regulators couldn't—pushing commodity traders straight into stablecoins' arms. That's according to Luke Sully, CEO of trade finance-focused stablecoin issuer Haycen, who says Western banks are retreating from certain commodity flows due to heightened compliance fears, triggering a fresh wave of debanking across commodity markets.

"Since the war, banks are further retreating from certain commodity flows," Sully told CoinDesk. "We spoke with some commodity traders who are getting debanked now."

The concern centers on counterparty risk. Banks worry that seemingly legitimate transactions involving firms in Oman or other regional hubs could have indirect exposure to sanctioned Iranian entities. Rather than take the risk, some institutions are stepping back entirely—which, honestly, tracks given how risk-averse banks have become since they discovered existential dread.

The result is reduced access to traditional rails in a sector that is already largely financed outside of traditional banking. Trade finance, a roughly $2 trillion market for international trade transactions, has increasingly been dominated by non-bank lenders, including private credit funds that finance the movement of commodities and goods globally.

These lenders provide critical liquidity, often earning annualized returns of around 15%, and enable transactions such as shipping helium from Qatar to South Korea or manganese from South Africa to Indonesia. But they rely on banks for settlement and payment rails—relationships that are now under strain, like a bridge built by engineers who only had coffee and vibes to work with.

Stablecoins are emerging as a key workaround. In particular, Tether's USDT has seen growing adoption among commodity traders and counterparties operating in emerging markets. Total stablecoin market capitalization surpassed $300 billion in 2025 after roughly 50% annual growth. Transaction volumes exceeded $4 trillion in 2025, accounting for around 30% of all onchain activity.

"Tether is soaking up a lot of the payments flow," Sully says. "If you want to make a one-time payment into an emerging market, USDT is helping." Basically, USDT is becoming the duct tape holding together international trade while the banking system has a panic attack about paperwork.

The appeal is straightforward: deep global liquidity and widespread acceptance. "There is so much global USDT liquidity that people don't mind sending or accepting it as payment, because someone in their country will eventually swap it for dollars." It's like hot potatoes, but the potatoes are worth exactly one dollar each and everyone wants in on the game.

Sully frames this trend as a workaround rather than a long-term solution. "This is more of a workaround for these people than a solution for trade finance in general." A band-aid on a bullet wound, but hey, at least it's sticking.

The geopolitical backdrop is producing even more extreme signals. Sully pointed to reports that bitcoin is being used as a "currency of choice" for payments tied to safe passage through the Strait of Hormuz, a critical chokepoint for global oil shipments. Turns out when traditional finance says "no can do," degens say "can do with slightly more explosions involved."

"It shows that trade finance is increasingly being led and managed by non-bank actors and non-bank ways of transacting," Sully says. The banks are essentially leaving the party early and wondering why everyone's still having fun without them.

Haycen is positioning itself to capture this shift. The firm issues a U.S. dollar-backed stablecoin, USDhn, designed specifically for trade finance. According to Sully, "Haycen aims to be the liquidity and settlement layer for non-bank global trade and is currently working with industry participants around the world."

Haycen's model allows users to deposit funds, transact using its stablecoin, and potentially earn interest, subject to regulatory eligibility, while avoiding the delays and inefficiencies of correspondent banking. "Funds don't get lost for seven days. You can log in, see your deposits and counterparties in one place, and settle instantly." Revolutionary concept: money moving at the speed of internet instead of the speed of a snail with navigation issues.

Unlike most stablecoin issuers, which focus on crypto trading or retail payments, Haycen is targeting a specific institutional niche. "Every other stablecoin business is a payments business or a crypto trading business," Sully said. "We're solving a different problem." Essentially, they're playing 4D chess while everyone else is fighting over checkers.

That problem—how to move money efficiently in a fragmented, increasingly de-risked global trade system—may only grow more acute as geopolitical tensions persist. Ironically, Sully notes, banks' retreat could accelerate crypto adoption faster than the industry itself ever managed. Sometimes the best marketing team is just being so annoying that everyone else builds a better option out of spite.