The Transformation of the Global Payment System: An In-Depth Analysis of the Stablecoin Ecosystem

The global financial system is undergoing a profound wave of transformation. Traditional payment networks are facing comprehensive challenges from emerging alternatives - stablecoins - due to outdated infrastructure, lengthy settlement cycles, and high costs. These digital assets are rapidly innovating the models of value cross-border flow, the paradigms of corporate transactions, and the ways individuals access financial services.

In recent years, stablecoins have continued to develop and have become an important underlying infrastructure for global payments. Large fintech companies, payment processors, and sovereign entities are gradually integrating stablecoins into consumer-facing applications and business funding flows. At the same time, a series of emerging financial tools, from payment gateways to deposit and withdrawal channels, and to programmable yield products, have greatly enhanced the convenience of using stablecoins.

This report provides a deep analysis of the stablecoin ecosystem from both technical and business perspectives. It studies 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 payment?

To explore 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, automated clearing houses, and peer-to-peer payments. Although they have become integrated into daily life, the infrastructure of many payment channels has existed since the 1970s. While groundbreaking at the time, most of these global payment infrastructures are now outdated and highly fragmented. Overall, these payment methods are plagued by high fees, high friction, long processing times, inability to achieve 24/7 settlement, and complex backend processes. Additionally, they often require payment for unnecessary extra services bundled with identity verification, lending, compliance, fraud protection, and bank integration.

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, shortens settlement times, and lowers costs.

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

• Real-time settlement: Transactions are completed almost instantaneously, eliminating delays found 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 reduces transaction fees, saving expenses for users.
• Global Coverage: Decentralized platforms can reach markets underserved by traditional financial services, achieving financial inclusion.

2. Landscape of the Stablecoin Payment Industry

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

1. First layer: Application layer

The application layer is mainly composed of various payment service providers, 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 working on the application layer, and provide credit card services for users.

a. Payment Gateway

Payment gateway is a service that securely processes payments, facilitating transactions between buyers and sellers.

Notable 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 functions, and 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 plugin, millions of merchants can settle payments using cryptocurrency and instantly convert USDY to other stablecoins, such as USDC, EURC, and PYUSD.
• Other applications also allow users to make payments using stablecoins, further expanding the application scenarios of stablecoins.

The realm 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 of these types, thereby shaping their core products, user experience, and target market.

The developer-oriented payment gateway is designed to serve businesses, fintech companies, and enterprises that need to integrate stablecoin infrastructure into their workflows. They typically offer application programming interfaces, software development kits, 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 for seamless process integration, has a payment platform for cross-border commercial payments, and allows enterprises to hold and trade multiple stablecoins and fiat currencies through enterprise accounts, along with merchant services that provide the tools needed for businesses to accept customer payments in stablecoins. Processing over $10 billion in annualized transaction volume, with a growth rate of 200%, and a valuation of $750 million, clients include emerging regions such as Africa, Latin America, and Southeast Asia.
• Iron: Provides an API to seamlessly integrate stablecoin trading into its existing business. It offers enterprises global deposit and withdrawal channels, stablecoin payment infrastructure, wallets, and virtual accounts, supporting customized payment workflows.
• Juicyway: Provides a range of enterprise payment, payroll distribution, and bulk payment APIs, supporting currencies including Nigerian Naira, Canadian Dollar, US Dollar, Tether, and USD Coin. Primarily targeting the African market, there is currently no operational data.

Consumer-oriented payment gateways are user-centric, providing a simple and easy-to-use interface that facilitates stablecoin payments, remittances, and financial services. They typically include mobile wallets, multi-currency support, fiat currency deposit and withdrawal channels, and seamless cross-border transactions. Some well-known projects focused 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 partners with local channels in Latin America to achieve almost zero withdrawal fees, with over 10,000 users in South America.
• Meso: A deposit and withdrawal solution that integrates directly with merchants, enabling users and businesses to easily convert between fiat currency and stablecoin with minimal friction. Meso also supports the purchase of USDC, simplifying the process for consumers to acquire stablecoins.
• Venmo: Venmo's stablecoin wallet feature utilizes 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, enabling seamless transactions by automatically converting cryptocurrency assets to fiat currency at the point of sale.

The project includes:

• Reap: An Asian card issuer with clients including over 40 enterprises, selling white-label solutions, primarily relying on transaction fees in collaboration with Hong Kong banks, covering most areas outside the United States, and supporting multi-chain deposits; by July 2024, the transaction volume reached $30M.
• Raincards: A card issuer in the Americas that supports multiple companies in issuing cards, with the biggest feature being its ability to serve users in the US and Latin America. Issued a USDC corporate card to pay for travel expenses, office supplies, and other daily business costs using on-chain assets.
• Fiat24: European card issuer + web3 bank, the business model is similar to the above two, supporting corporate card issuance; Swiss license, mainly serving European + Asian users, currently does not support full-chain transactions, only specific top-ups. Total users 20,000, monthly revenue $100K-150K.
• Kast: A rapidly growing U card, with over 10,000 cards issued, 5-6k monthly active users, $7m transaction volume in December 2024, and $200k revenue.
• 1Money: The stablecoin ecosystem has recently launched a credit card that supports stablecoins and provides a software development kit for easy integration.

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

2. Second Layer: Payment Processor

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

a. Deposit and Withdrawal Processor

• Moonpay: Supports over 80 cryptocurrencies, offers various deposit and withdrawal methods as well as token exchange services to meet users' diverse cryptocurrency trading needs.
• Ramp Network: Covers over 150 countries and provides deposit and withdrawal services for more than 90 types of crypto assets. The network handles all identity verification, 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 bidirectional exchange and payment between fiat currency and crypto assets, achieving the integration of traditional fiat currency and crypto asset payments.

b. Stablecoin Issuance & Coordination Processors

• Bridge: The core products of Bridge include the Coordination API and the Issuance API. The former helps enterprises integrate various stablecoin payments and exchanges, while the latter supports enterprises 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 the Treasury, possessing strong compliance operational 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 must undergo corporate identity verification, while users need to establish an account with Brale for identity verification. Brale's clients are more often on-chain OGs, with slightly less backing from investors and business development compared to Bridge.
• Perena: The Numeraire platform by Perena reduces the issuance threshold for niche stablecoins by encouraging users to provide concentrated liquidity in a single pool. Numeraire adopts a "central hub-radiating" model, with USD* as the central reserve asset, serving as the "hub" for stablecoin issuance and exchange. This mechanism allows for the efficient minting, redemption, and trading of multiple stablecoins linked to different assets or jurisdictions, with each stablecoin acting as a similar "spoke" connected to USD*. Through this system structure, Numeraire ensures Depth liquidity and enhances capital efficiency, as smaller stablecoins can interoperate through USD* without needing to provide separate 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.

3. Layer Three: Asset Issuer

The asset issuer is responsible for creating, maintaining, and redeeming stablecoins. Its business model is typically centered around the balance sheet, similar to how banks operate - accepting customer deposits and investing the funds in high-yield assets such as U.S. Treasury bonds to earn a spread. At the asset issuer level, stablecoin innovations can be divided into three tiers: static reserve-backed stablecoins, interest-bearing stablecoins, and revenue-sharing stablecoins.

1. Stablecoin supported by static reserves

The first generation of stablecoins introduced the foundational model of digital dollars: centralized issued tokens backed 1:1 by fiat reserves held by traditional financial institutions. The main participants in this category.