The month fintechs embraced stablecoins

We’ve argued before that stablecoins would eat payments, but this month many of the biggest payment companies in the world took notice. In the last six weeks alone: USDC issuer Circle filed to go public on the New York Stock Exchange; Coinbase entered agentic payments with a standard for stablecoin API payments; Visa and Mastercard enhanced stablecoin support; Stripe announced stablecoin financial account balances, a programmable stablecoin, a stablecoin-backed card, and more. 

The throughline between all of these announcements is all about meeting users where they are, which we can think of as a Skype moment for payments. Here’s what I mean: In 2003, Skype launched their first killer feature, the ability to make reduced-rate calls from computers to landlines. But after enough people joined digital call networks, they could finally ditch phone calls for internet-based WhatsApp calls, heralding a seamless shift in underlying technology from landlines to mobile carriers to internet-based voice and data connections. 

Likewise, connecting stablecoins to traditional systems will help more people interact directly with stablecoins, even if they need to rely on legacy payment companies building backwards-compatibility into existing products. And as more people and businesses adopt stablecoins using existing products, there will be more opportunities to use stablecoins in new or better blockchain-based products —  to self custody, make purchases, send money, use DeFi, and more.

Here’s our timeline of announcements from the last six weeks, how they fit into the bigger picture, and why they matter (you can also sign up for our newsletter for more updates, analysis, and other resources)…

May 7 and 8: Stripe announced Stablecoin Financial Accounts, which allows business users to hold account balances in stablecoins in 101 countries. They also announced USDB — a programmable stablecoin that allows developers to embed digital dollars into their apps (and rewards them for building on USDB). (Stripe | X)

Stripe is building adoption incentives directly into the stablecoin layer to grow adoption and own more of the stack. By launching Stablecoin Financial Accounts, Stripe can skip the slow and expensive correspondent-bank maze, cut out payment networks, and compete directly with banks and card networks. Stablecoin Financial Accounts allow Stripe to support users in 101 countries, up from 46 countries previously. USDB will likely be the default stablecoin on Stripe products, giving them even more ways to monetize payments.

These launches will allow Stripe to offer cheaper, more customizable, more widely available, and more profitable products using neutral blockchain rails instead of card networks.

May 7: MoneyGram, a leading global in-person payments network, announced MoneyGram Ramps, a programmable stablecoin on and offramp that enables cash deposits and withdrawals in 170+ countries. (PRNewsWire)

Why it matters: Stablecoins have already found product-market fit in emerging markets, where remittances have driven early adoption. And yet, it’s surprisingly difficult to move between stablecoins and physical cash, which still serves as a widely accepted fallback in most markets. MoneyGram has a global cash network, which gives stablecoins another way to interoperate with everyday buying and spending.

May 6: Coinbase announces x402, a new standard for internet-native stablecoin payments, to enable atomic transactions between APIs, Apps, and AI agents. (Coinbase)

Did you know that Visa can’t handle sub-cent payments? Agentic commerce — where autonomous software agents execute transactions on behalf of users — needs programmable money if we want agents to buy and spend for us.

Stripe, Visa, and others are exploring their own solutions for owning the agentic commerce layer. Stablecoins are an attractive option because they’re built on a credibly neutral, decentralized platform. And since decentralized protocols don’t charge extractive fees, stablecoins are likely to have the lowest long-term fees. The “x402” standard bakes in stablecoin settlement, intent-based payments, and compliance into one spec — laying rails that Visa and SWIFT can’t match on speed, composability, or programmability. 

May 6: Visa and BVNK announce a strategic partnership. (BVNK)

Visa’s partnership with BVNK can be interpreted as a bet on stablecoin “plumbing” — giving the card network direct access to the very payment rails that threaten to bypass it. By partnering with stablecoin payments infrastructure company BVNK, Visa can hedge against Stripe’s growing suite of stablecoin payments products. 

Visa is being smart here: expect other incumbent payment companies to follow suit, or risk renting the future from the dominant stablecoin payments platforms and startups.

April 28 and 30: Mastercard and Visa announce products that allow consumers to use stablecoin balances for everyday purchases via card swipes. (Mastercard | Visa)

On April 28, Mastercard announced broader stablecoin integrations in partnership with Circle, OKX, Paxos, and multiple exchanges and wallets. These updates allow consumers to spend linked stablecoin balances using Mastercard cards. They also  enable merchants to settle fiat card payments to USDC. 

Two days later, Visa and Stripe-backed Bridge announced that fintech developers building on Bridge will be able to issue stablecoin-linked Visa cards, allowing users to pay from linked stablecoin balances at fiat points of sales via the Visa network.

Both of these products can grow stablecoin adoption by integrating with the systems people already use every day. Card users can save and spend in stablecoins directly, without having to worry about whether or not a merchant accepts stablecoins; they can just use the attached Visa or Mastercard when stablecoins aren’t supported. 

Stablecoin-linked cards enable backwards compatibility with existing infrastructure, but the “strong form” of the technology will eventually win. Ultimately, merchants will prefer to avoid the 2.5% swipe fee. But in future, stablecoin payments may be accessible at the point of sale directly, allowing businesses to get better margins. At the same time, entrepreneurs will continue to build new products that make stablecoins a naturally better choice.

Meanwhile, Stripe has since announced a partnership with financial operations platform Ramp to launch stablecoin-backed cards starting in Latin America, creating even more ways for users to spend.

April 23:  PayPal announces 3.7% yield on PYUSD held in PayPal or Venmo balances for US users starting in 2025. (Paypal)

PayPal wants deposits — even if they live in MetaMask. By offering 3.7% yield on PYUSD when held in Venmo or PayPal, they are incentivizing users to buy and hold the stablecoin in-app. But PYUSD makes PayPal even more money when held off-platform — expect yield to be the first step towards building PYUSD volume and integrations.

April 21: Circle announces Circle Payments Network in partnership Deutsche Bank Société Générale, Banco Santander, Standard Charter Bank and many stablecoin startups to improve international payments. (Circle)

Circle is taking on SWIFT — the dominant network for facilitating international bank transfers — and the correspondent banking network by directly going after its often-maligned messaging service and slow payments. In order to succeed, they’ll need to create a business model and product for Circle Payments Network that’s better than correspondent banking.

April 1: Circle files to go public on the NYSE, legitimizing stablecoin payments. (SEC)

The lead-up to Circle’s S-1, which started in January and culminated in the filing on April 1, served to further legitimize stablecoin payments, setting the stage for greater user adoption, and kicking off a month packed with announcements from some of the world’s most important fintech companies.

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So what does it all mean? Traditional payments companies have not only recognized the value of stablecoins — they’re now building key infrastructure that gives stablecoins backwards compatibility, supercharging adoption. Although these products may initially look a lot like the payment methods we’ve had for decades, the payment companies are actually bootstrapping a new onchain economy by embracing and building on stablecoins.

How do we expect this to play out? We’re now seeing people reliably use stablecoins via traditional payments. The infrastructure improvements launched this year will lead to more people using stablecoins directly. And by making it easier and more intuitive to integrate stablecoins, we’ll also begin to see greater network effects: More entrepreneurs building a novel generation of products that are only possible with nearly instant, nearly free, programmable money.

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Sam Broner is a partner on the investing team at a16z crypto. Prior to joining a16z, Sam was a software engineer at Microsoft, where he was on the founding team of the Fluid Framework and Microsoft Loop. Sam also attended MIT’s Sloan School of Management, where he worked on Project Hamilton at the Federal Reserve Bank of Boston, led the Sloan Blockchain Club, directed Sloan’s first AI Summit, and won MIT’s Patrick J. McGovern award for creating an entrepreneurial community. Follow him on X @SamBroner, and read more of his work at sambroner.com.

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