Stablecoin and payments are two sides of the same coin — neither can scale without the other
Stablecoin, stablecoin, stablecoin.
While stablecoin have dominated conversations among financial institutions, fintechs, and venture capitalists, the true opportunity lies not in the asset itself—but in its utility. A stablecoin, like any form of money, is inherently useless without a system to give it purpose. It functions as a medium of exchange, a store of value, and a unit of account, but its real power depends entirely on what it can access, represent, or move.
Despite being highly valued by investors, stablecoin remain abstract instruments—reliant on external systems such as payment rails, settlement layers, and the broader banking infrastructure. To truly unlock their potential, stablecoin issuers must go beyond token issuance and rebuild the payments stack from first principles, positioning stablecoin not as passive tools but as core infrastructure in the next wave of financial innovation. Payments is the trillion-dollar opportunity hiding in plain sight—and stablecoin may be the key to unlocking it.
How We Got Here
To understand where stablecoin are headed, it's essential to understand how we got here. The story of payments is one of constant reinvention—each wave of innovation building on the shortcomings of the last. From PayPal to plastic cards, neobanks to super-apps, every leap has pushed money closer to real-time, programmable, and borderless. Stablecoin are poised to become the next evolution—but only if they integrate into the payments stack as seamlessly as their predecessors.
In the late 1990s, PayPal burst onto the scene as one of the first peer‐to‐peer online payment platforms. Traditional plastic credit cards (Visa, MasterCard, AMEX, etc.) had meanwhile matured into the ubiquitous “rails” of global commerce, handling the vast majority of everyday retail transactions. The 2010s ushered in a new wave of fintech challengers – app‐based “neobanks” and payment platforms – reshaping how people move money. For example, Revolut (launched in 2015) quickly amassed over 50 million users and a multi‐billion valuation, and Stripe (founded 2010) scaled to process over a trillion dollars of e‑commerce volume per year. In parallel, smartphones gave rise to digital wallets: Apple introduced Apple Pay in 2014, China’s Alibaba launched Alipay in 2004 (eventually becoming the world’s largest mobile‑wallet platform), and countless other mobile payment apps spread globally. Together these milestones trace a clear arc from PayPal’s early success through the credit‑card era to today’s booming mobile‐wallet and super‑app ecosystem, illustrating how payments have evolved from cash and cards into borderless digital finance.
As the payments landscape continues its shift toward programmable and borderless finance, a new crypto-native stack is emerging—one built around stablecoin as the underlying settlement asset. This next-generation stack mirrors and reimagines traditional financial infrastructure, spanning everything from card issuance to global remittances, merchant tools, and APIs.
Here's a look at the key verticals shaping the future of crypto payments:
Crypto Cards — Issue a virtual/physical card to users, enabling them to pay directly with their crypto balance.
Pros: Easy to off-ramp funds for everyday spending; ideal for high-agency crypto users who enjoy flexibility.
Cons: Higher fees compared to local off-ramp methods; card issuers must manage fraud risk, and it is generally a low-margin business.
Opportunity: Yields from stablecoin could potentially be used to bootstrap token-based loyalty programs.
Stablecoin Wallet — A Web3 wallet with a fintech-like experience. These may issue crypto cards and often include a savings/investment product to complement the cards.
Pros: UX is similar to fintech apps and provides a level of abstraction from blockchain complexities.
Cons: Limited differentiation from traditional fintech wallets; faces high customer acquisition costs similar to fintechs.
Opportunity: Drive greater stablecoin adoption among retail users and increase on-chain stablecoin TVL.
Cross-Border Payments — Enable retail users and businesses to send funds globally using blockchain rails, with a focus on FX.
Pros: Faster and cheaper to send funds globally compared to the traditional payments stack.
Cons: May not be optimized for high-value transactions (8–9 figures) due to slippage; dependent on stablecoin liquidity.
Opportunity: Build sufficient on-chain liquidity to become the de facto currency for any FX swaps involving local currency.
Neobank — Business banking using blockchain rails, potentially including both domestic and cross-border payments. Provides an interface for accounts payable/receivable, remote payroll, and treasury management.
Pros: Ideal for businesses managing part of their treasury in stablecoin/crypto; assists with financial reconciliation.
Cons: Relatively small market but an emerging one; competes with centralized exchanges (CEXs).
Opportunity: Stablecoin float within these neobanks could drive on-chain liquidity and serve as a monetization channel for issuers.
On/Off Ramps — Convert fiat to crypto through local payment rails with low interchange and FX fees.
Pros: Highly localized in terms of currency and supported payment methods.
Cons: May not always be the cheapest way to get on-chain depending on the payment infrastructure (e.g., cards vs. local PSPs); requires delicate liquidity management.
Opportunity: Payment rails are the moat for stablecoin issuers today. Identifying opportunities to extend these alongside their stablecoin could help them achieve better margins.
Merchant Acceptance — Enable businesses (both online and offline) to receive crypto as payment from customers. Solutions may include an SDK for online storefronts or a QR code for physical stores.
Pros: Allows merchants to accept crypto payments with fiat-based settlement.
Cons: Difficult to penetrate the merchant acquirer market and generate strong network effects without friction. Existing solutions rely on payment stacks that use stablecoin as intermediaries, without real value accrual to the issuer.
Opportunity: Stablecoin issuers could explore launching their own POS systems to facilitate seamless crypto acceptance, decoupled from existing rails.
Stablecoin Chain — Infrastructure optimized for stablecoin payments, with features like transaction-level privacy, payee tokenization, and escrow.
Pros: Highly customizable to meet end-merchant requirements.
Cons: Challenging to aggregate multiple stablecoin issuers and liquidity onto a single chain.
Opportunity: Beyond token-level control, issuers may consider customizing blockchain features to comply with local regulations. This could unlock monetization opportunities such as payment for FX order flow, sequencer fees, or priority fees for faster transaction inclusion.
Stablecoin API — APIs directly connected to stablecoin issuers, enabling fintechs and non-bank financial institutions to send, receive, and manage stablecoin programmatically.
Pros: Developer-friendly; can be easily integrated into existing payment stacks to enable stablecoin functionality.
Cons: The ease of minting/burning via API is a double-edged sword, while it increases usage, stablecoin may not remain onchain long enough for issuers to earn yield from reserves.
Opportunity: Issuers could implement a mint/burn fee for payment flows exceeding a certain daily transaction volume.
What Do Merchants Want?
Merchants care less about ideology/technology and more about reliability, cost-efficiency, and simplicity. Payments are inherently bi-directional—success requires alignment between the issuer and the merchant. Most merchants are chain-agnostic; they'll gravitate toward whichever network is fast, cheap, and gets the job done. For them, same-day settlement is often sufficient, and marginal gains in block times are largely irrelevant as of today but I expect this to change with real-time payments. What matters more is minimizing friction: sweeping funds to a central address without incurring high gas fees, maintaining transaction privacy, and having features like escrow or reversibility for large-value flows. Payments-focused blockchains must evolve beyond speed and cost; to win meaningful volume, they need to offer merchant-grade infrastructure and incentives. Being cheap and fast is table stakes—value-added functionality and real economic incentives will be what ultimately drive adoption.
Where Do We Go Next
Stablecoin are no longer just speculative instruments or digital equivalents of cash—they’re becoming the connective tissue for a new financial operating system. The challenge ahead is not about proving the value of stablecoin, but about embedding them into real-world financial flows in ways that are invisible, intuitive, and inevitable.
Where do we go next? We stop treating stablecoin as standalone products and start building the systems that make them indispensable. That means reimagining card networks, merchant acquiring, treasury infrastructure, cross-border rails, and developer APIs—not as extensions of the traditional stack, but as native constructs in a stablecoin-first world.
For issuers and builders, the opportunity is massive: to create not just a better payment method, but an entirely new payments ecosystem—faster, programmable, and more globally inclusive than anything that has come before. Whether through neobank interfaces for businesses, seamless on/off-ramps for users, or APIs for developers, the goal is the same: abstract the complexity and unlock utility at scale.
The next frontier isn’t just stablecoin—it’s payments, rebuilt. And this time, the infrastructure won’t be licensed from banks. It will be written in code, deployed onchain, and denominated in trustless, interoperable, programmable money.
**Disclaimer:** The views and opinions expressed in this article are solely my own and do not reflect the views or positions of my employer, any affiliated entities, or any other organizations with which I am associated. The content provided is for informational purposes only and should not be considered as financial or investment advice. I do not endorse any particular protocol or platform. Readers are encouraged to do their own research and consult with a licensed financial advisor before making any investment decisions.