The Rise of Stablecoin Payment Ecosystems: A Comprehensive Analysis from Technology to Business

The global financial system is undergoing profound changes. Traditional payment networks are facing comprehensive challenges from stablecoins due to outdated infrastructure, lengthy settlement periods, and high costs. These digital assets are rapidly transforming cross-border value flow patterns, corporate trading paradigms, and individuals' access to financial services.

In recent years, stablecoins have continued to develop and have become an important infrastructure for global payments. Large fintech companies, payment processors, and sovereign entities are gradually integrating stablecoins into consumer-facing applications and corporate cash flow. At the same time, emerging financial tools such as payment gateways, capital inflow and outflow channels, and programmable yield products have greatly enhanced the convenience of using stablecoins.

This report provides an in-depth analysis of the stablecoin ecosystem from both technical and business perspectives. It examines the key players shaping this field, the core infrastructure supporting stablecoin transactions, and the dynamic demand driving its applications. Additionally, it explores how stablecoins give rise to new financial application scenarios and the challenges they face in being widely integrated into the global economic process.

1. Why choose stablecoin for payment?

To understand the influence of stablecoins, it is essential to examine traditional payment solutions. These traditional systems encompass cash, checks, debit cards, credit cards, international wire transfers (SWIFT), automated clearing houses (ACH), and peer-to-peer payments, among others. Although they have become integrated into daily life, many payment channels, such as ACH and SWIFT, have existed since the 1970s. While they were groundbreaking at the time, today, most of these global payment infrastructures are outdated and highly fragmented. Overall, these payment methods are plagued by high fees, significant friction, long processing times, the inability to achieve round-the-clock settlement, and complex backend processes. Furthermore, they often come bundled with unnecessary additional services such as identity verification, lending, compliance, fraud protection, and bank integration, which may incur fees.

Stablecoin payments are effectively addressing these pain points. Compared to traditional payment methods, using blockchain for payment settlement greatly simplifies the payment process, reduces intermediaries, achieves real-time visibility of fund flows, not only shortens settlement times but also lowers costs.

The main advantages of stablecoin payments can be summarized as follows:

• Real-time settlement: Transactions are completed almost instantaneously, eliminating delays in traditional banking systems.
• Safe and reliable: The immutable ledger of blockchain ensures the security and transparency of transactions, providing protection for users.
• Cost reduction: Eliminating intermediaries significantly lowers transaction fees, saving expenses for users.
• Global coverage: Decentralized platforms can reach markets that are underserved by traditional financial services (including unbanked populations), achieving financial inclusion.

2. The Landscape of the Stablecoin Payment Industry

The stablecoin payment industry can be divided into four technical stack layers:

1. Layer One: Application Layer

The application layer is mainly composed of various payment service providers (PSP), which integrate multiple independent deposit and withdrawal payment institutions into a unified aggregation platform. These platforms provide users with convenient access to stablecoins, offer tools for developers developing on the application layer, and provide credit card services for Web3 users.

a. Payment Gateway

Payment gateways are services that facilitate transactions between buyers and sellers by securely processing payments.

Renowned companies innovating in this field include:

• Stripe: A traditional payment provider that integrates stablecoins like USDC for global payments.
• MetaMask: It does not provide direct fiat currency exchange functionality; users can perform deposit and withdrawal operations through integration with its third-party services.
• Helio: 450,000 active wallets and 6,000 merchants. With the Solana Pay plugin, millions of Shopify merchants can settle payments using cryptocurrency and instantly convert USDY into other stablecoins such as USDC, EURC, and PYUSD.
• Web2 payment applications such as Apple Pay, PayPal, Cash App, Nubank, and Revolut also allow users to make payments using stablecoins, further expanding the application scenarios of stablecoins.

The field of payment gateway providers can be clearly divided into two categories (with some overlap).

1. Payment gateway for developers; 2) Payment gateway for consumers. Most payment gateway providers tend to focus more on one type, which shapes their core products, user experience, and target market.

The developer-oriented payment gateway aims to serve businesses, fintech companies, and enterprises that need to embed stablecoin infrastructure into their workflows. They typically provide application programming interfaces (APIs), software development kits (SDKs), and developer tools for integration into existing payment systems, enabling features such as automated payments, stablecoin wallets, virtual accounts, and real-time settlement. Some emerging projects focused on providing such developer tools include:

• BVNK: Provides enterprise-level payment infrastructure for easy integration of stablecoins. BVNK offers API solutions that ensure seamless processes, a payment platform for cross-border commercial payments, and enterprise accounts that allow businesses to hold and trade multiple stablecoins and fiat currencies, as well as merchant services that provide the tools necessary for businesses to accept customer payments in stablecoins. Processing over $10 billion in annual transaction volume, with a growth rate of 200% per year, and a valuation of $750 million, clients include emerging regions such as Africa, Latin America, and Southeast Asia.
• Iron: Provides APIs to seamlessly integrate stablecoin transactions into their existing business. It offers businesses global deposit and withdrawal channels, stablecoin payment infrastructure, wallets, and virtual accounts, supporting customized payment workflows (including recurring payments, invoicing, or on-demand payments).
• Juicyway: Provides a range of enterprise payment, salary distribution, and bulk payment APIs, supporting currencies including Nigerian Naira (NGN), Canadian Dollar (CAD), US Dollar (USD), Tether (USDT), and USD Coin (USDC). Primarily targeting the African market, with no operational data available yet.

Consumer-focused payment gateways prioritize the user, offering an easy-to-use interface that facilitates stablecoin payments, remittances, and financial services. They typically include mobile wallets, multi-currency support, fiat deposit and withdrawal channels, and seamless cross-border transactions. Some well-known projects that focus on providing users with this simple payment experience include:

• Decaf: An on-chain banking platform that enables personal consumption, remittances, and stablecoin transactions in over 184 countries; Decaf collaborates with local channels including MoneyGram in Latin America, achieving almost zero withdrawal fees, with over 10,000 South American users.
• Meso: Deposit and withdrawal solution, directly integrated with merchants, allowing users and businesses to easily convert between fiat currency and stablecoins with minimal friction. Meso also supports Apple Pay to purchase USDC, simplifying the process for consumers to acquire stablecoins.
• Venmo: Venmo's stablecoin wallet feature leverages stablecoin technology, but its functionality is integrated into its existing consumer payment application, allowing users to easily send, receive, and use digital dollars without directly interacting with the blockchain infrastructure.

U Card

Cryptocurrency cards are payment cards that allow users to spend cryptocurrency or stablecoins at traditional merchants. These cards are typically integrated with traditional credit card networks (such as Visa or Mastercard), enabling seamless transactions by automatically converting cryptocurrency assets into fiat currency at the point of sale.

The project includes:

• Reap: An Asian card issuer with clients including Infini, Kast, Genosis pay, Redotpay, Ether.fi, and more than 40 other companies. It sells white-label solutions and mainly relies on transaction volume for commission (e.g., Kast 85%-Reap 15%). It cooperates with banks in Hong Kong, covering most areas outside the United States and supporting multi-chain deposits; the transaction volume reached 30 million USD in July 2024.
• Raincards: A card issuer in the Americas, supporting card issuance for companies like Avalanche, Offramp, takenos, etc. Its main feature is the ability to serve users in the U.S. and Latin America. It has issued a USDC corporate card to pay for travel expenses, office supplies, and other everyday business costs using on-chain assets (such as USDC).
• Fiat24: European card issuer + web3 bank, the business model is similar to the above two companies, supporting card issuance for enterprises like ethsign, safepal; Swiss license, mainly serving users in Europe + Asia, currently does not support full-chain transactions, only allows deposits through Arbitrum. Growth is slow with a total user base of 20,000 and a monthly revenue of $100,000 to $150,000.
• Kast: A rapidly growing U-card on Solana, currently issuing over 10,000 cards, with 5-6 thousand monthly active users. By December 2024, the transaction volume is expected to reach 7 million USD, with an income of 200,000 USD.
• 1Money: A stablecoin ecosystem that recently launched a credit card supporting stablecoins and provides a software development kit for easy L1 and L2 integration.

There are many cryptocurrency card providers, which mainly differ in terms of service areas and supported currencies, and they generally offer low-fee services to end users to enhance the enthusiasm for using cryptocurrency cards.

2. Layer Two: Payment Processor

As a key layer in the stablecoin technology stack, payment processors are the backbone of payment channels, mainly covering two categories: 1. Deposit and withdrawal service providers 2. Stablecoin issuance service providers. They act as a crucial intermediary layer in the payment lifecycle, connecting Web3 payments with traditional financial systems.

a. Deposit and Withdrawal Processor

• Moonpay: Supports over 80 cryptocurrencies, offering various deposit and withdrawal methods as well as token swap services to meet users' diverse cryptocurrency trading needs.
• Ramp Network: Covers over 150 countries and provides deposit and withdrawal services for more than 90 cryptocurrency assets. The network handles all KYC (Know Your Customer), AML (Anti-Money Laundering), and compliance requirements, ensuring the compliance and security of deposit and withdrawal services.
• Alchemy Pay: A hybrid payment gateway solution that supports two-way exchange and payment between fiat currencies and crypto assets, achieving the integration of traditional fiat currency and crypto asset payments.

b. Stablecoin Issuance & Coordination Processor

• Bridge: The core products of Bridge include the Coordination API and Issuance API. The former helps businesses integrate various stablecoin payments and exchanges, while the latter supports businesses in quickly issuing stablecoins. The platform is currently licensed in the United States and Europe and has established important partnerships with the U.S. State Department and Treasury, possessing strong compliance operation capabilities and resource advantages.
• Brale: Similar to the Bridge product, it is a regulated stablecoin issuance platform that provides stablecoin coordination and reserve management APIs. It has compliance licenses in various states across the United States, and partner companies are required to undergo KYB (Know Your Business), while users need to set up accounts on Brale for KYC (Know Your Customer). Brale's clients are primarily on-chain OGs (e.g., Etherfuse, Penera, etc.) and are slightly less backed by investors and business development compared to Bridge.
• Perena: The Numeraire platform of Perena lowers the issuance threshold for niche stablecoins by encouraging users to provide concentrated liquidity in a single pool. Numeraire adopts a "central hub-radiating" model, where USD* serves as the central reserve asset, acting as the "hub" for stablecoin issuance and exchange. This mechanism allows for the efficient minting, redemption, and trading of multiple stablecoins pegged to different assets or jurisdictions, with each stablecoin connected to USD* as a similar "spoke". Through this system structure, Numeraire ensures deep liquidity and enhances capital efficiency, as small stablecoins can interoperate via USD* without the need to provide dispersed liquidity pools for each trading pair. The ultimate design goal of the system is not only to enhance price stability and reduce slippage but also to enable seamless conversion between stablecoins.