Stablecoin Payments: The Next Phase of Digital Commerce

If you work in payments, you can feel the ground shifting. You can see traditional payment rails evolving alongside fintech innovation, as new digital payment methods challenge long-standing models and expand what’s possible in commerce. On top of that, stablecoin payments have also entered the mainstream conversation.

This piece breaks down stablecoin payments — what they are, how they work, where adoption is growing, and why the next phase of digital commerce will be built on top of them. We’ll also clarify what US policymakers mean by “payment stablecoins,” explain real‑world stablecoin payment flows like the “stablecoin sandwich,” and end with a look at how Circle Payments Network (CPN) can help institutions simplify their payments, compliance, and capital management.

Why stablecoin payments are resonating

Stablecoins are digital assets designed to maintain steady value, most often pegged in value to a fiat currency like the US dollar (USD) or the euro (EUR). Stablecoins are proving to be a practical bridge between digital asset innovation and everyday commerce, especially for businesses that need speed, transparency, and global reach without taking on the volatility associated with other digital assets.

Most fiat‑backed stablecoins keep reserves in cash and short‑dated government instruments so that each token can be redeemed for its underlying currency. For example, Circle’s USDC and EURC are fully backed by highly liquid cash and cash-equivalent assets. This straightforward design helps reduce the price fluctuations common to crypto assets like bitcoin (BTC) or ether (ETH), while letting users retain the best parts of blockchain: global reach, programmability, and fast and transparent settlement. Circle’s USDC and EURC stablecoins represent the gold standard of stablecoin reserve practices and management and, complete with regular attestations, are designed to be redeemable 1:1 for dollars and euros respectively. Circle’s transparency into its sound reserve management is what makes stablecoins like USDC a viable payment option for finance and payments teams.

Payment stablecoin benefits: practical and immediate

Payment platforms that leverage stablecoins can solve problems within your organization that may not be addressed by alternative payment methods. Stablecoins can offer:

• Finality and speed: Stablecoin transactions can settle in minutes (or seconds), not days. Running on blockchain rails, there are no payment cut‑off windows for non-standard operating hours, weekends, or holidays. And once transactions are confirmed and finalized on a blockchain, there are no chargebacks or reversed payments.
• Cost control: Lower network fees and fewer intermediaries than legacy banking systems can reduce end‑to‑end payment costs, especially for cross‑border stablecoin payment flows.
• Programmability: Stablecoins exist as programmable assets, and can be used to embed custom business rules directly in the transaction flow for escrow, split payments, payroll, conditional capital releases, and more.
• Auditability: Onchain transfers are timestamped, irreversible, and transparently and permanently recorded, improving reconciliation and risk analytics. This lets your business track and monitor transactions to maintain compliance — and mitigate issues related to internal or external fraud or theft concerns.

Stablecoin payment gateways, or services that allow businesses to accept and process payments using stablecoins, can also supercharge the reach and effectiveness of your product and growth teams. The benefits of payment stablecoins for these stakeholders include:

• Global reach: Stablecoins move across open blockchain networks that users with a crypto wallet can access. This simplifies the sending and receiving of payments for companies that operate on an international level.
• Better user experience (UX): Businesses can abstract away onchain complexity so users see familiar interfaces and fiat currencies while you route their payments over fast, programmable blockchain rails. Users may not even know that stablecoins were involved in their transaction. Discussed in detail below, stablecoins can serve as the payment medium in cross-border transactions that start and end with local currencies.
• Near-instant distribution: Payouts, refunds, and marketplace disbursements can settle quickly and globally.

Stablecoin remittances and cross‑border payments

On average, the world still pays a high price to move money internationally. In 2025, the global average cost to send remittances remained above 6%. This is well above the G20’s remittance target cost of 1%. Stablecoins can meaningfully reduce total transaction costs by minimizing correspondent hops and automating foreign exchange (FX) and transaction settlement.

For example, a remittance provider in Latin America can use USDC to move funds from the United States to Argentina in minutes instead of days. A sender funds their transfer in USD, the provider converts those funds to USDC to send over a blockchain network, and the recipient receives pesos in their local account after near-instant onchain settlement. This approach removes multiple intermediaries, reduces FX markups, and allows for faster, transparent reconciliation.

Understanding “payment stablecoins” under the GENIUS Act

You may have seen US lawmakers use the specific term “payment stablecoins.” In the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, a “payment stablecoin” is a digital asset used for transaction payment or settlement and redeemable at a predetermined and fixed amount. The GENIUS Act is deliberately tailored to provide guidance on stablecoins rather than volatile digital assets.

The GENIUS framework emphasizes robust reserve backing, disclosures, and consumer protections designed to maintain stability, reliability, and trust. The Senate Banking Committee’s fact sheet highlights key guardrails:

• 100% reserve backing with cash and short‑term US treasuries or similarly liquid assets (as determined by the primary regulator)
• Strict marketing standards that prevent implying government or FDIC backing
• Monthly public disclosures of stablecoin reserve composition

In the case of insolvency, stablecoin holders’ claims are prioritized over all other interests.

This regulatory framework matters for institutions that utilize stablecoins at scale. A comprehensive and risk-managed payment stablecoin definition gives institutions, enterprises, and financial entities a clearer compliance framework. This allows them to more safely evaluate stablecoin payment solutions, vendors, and products.

Stablecoin payment flows keep growing

Stablecoin headlines in the media draw attention, but the numbers tell the real story. As of January 14, 2026, the collective stablecoin market cap stood at over $300 billion, a year-over-year increase of approximately 55%.

Onchain transaction analysis shows trillions of dollars in adjusted stablecoin volume. USDC, for example, has a lifetime trading volume of over $55 trillion as of January 14, 2026, while Visa’s onchain analytics reported over $1.23 trillion in stablecoin transaction volume over the month of December 2025.

And while institutional stablecoin adoption captured the spotlight in 2025, retail adoption also remains strong. In fact, the number of stablecoin transfers under $250 hit $5.84 billion in August 2025, a record all-time high. This indicates growing usage of stablecoins by individuals as a regular payment method.

Stablecoin payment flows are reinforced by enterprise initiatives and policy clarity in major markets like the GENIUS Act in the US and the EU’s Market in Crypto-Assets Regulation (MiCA), which advance regulatory clarity and make it easier for banks, payment service providers (PSPs), and global brands to integrate stablecoins into their payment flows.

Where payment stablecoins stand today

Stablecoins have proven their utility and flexibility, covering a multitude of payment use cases. Some of today’s major stablecoin payment use cases include:

• Speeding up settlement and reducing cross-border working capital friction.
• Supporting payouts and settlement on online marketplaces, gig platforms, gaming and content ecosystems, and other platforms.
• Simplifying contract and payroll payments with shortened settlement times and lower transaction fees.
• Making even low-value transfers (e.g., less than $100 or $10) practical in previously high-cost payment corridors. (And even abstracting away the use of blockchain rails so users on both ends of the transaction only see the fiat they are familiar with.)

Popular stablecoin payment models

For institutional use, you’ll see two primary approaches to stablecoin payment flows. The differences come down to how value is transferred between stablecoins and local currencies.

The stablecoin sandwich (i.e., local currency → stablecoin → local currency)

• What it is: The sender funds in their local currency, and their payment provider converts the funds to stablecoins in order to send the payment via blockchain, then the stablecoins are converted back and paid out to the receiver in their local currency.
• Why teams use it: You keep the UX in local currencies while replacing the slowest and costliest part of a transaction, cross‑border settlement, with a stablecoin transfer.
• Where it’s used: B2B supplier payments, remittances, PSP‑to‑PSP settlements, internal transfers, and card and wallet programs that use stablecoins as the “middleware.” In many cases, users don’t even realize stablecoins were used under the hood.

One‑legged stablecoin transactions (local currency ↔ stablecoin)

• What it is: One end of the payment starts or ends in stablecoins. For example, a marketplace might pay creators in USDC while accepting local currency from customers, or vice versa.
• Why teams use it: When a sender or receiver prefers stablecoins — due to desired digital dollar access (e.g., emerging markets), faster redeployment of funds, reduced FX conversion costs, etc. — but the other party needs local currency.
• Where it’s used: Global talent payouts, and consumer payments in regions where direct stablecoin acceptance is emerging (e.g., pilots that let shoppers pay in stablecoins while merchants receive local currency).

This chart helps visualize the difference between these two stablecoin payment flows:

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The “sandwich” pattern is becoming an industry standard for cross‑border payments while firms gradually add support for direct stablecoin acceptance on one side. Over time, more corridors will support direct stablecoin‑to‑stablecoin FX, further simplifying onchain flows.

Stablecoins for cross‑border payments: what to consider

If you haven’t yet integrated stablecoin payments into your operations, here are several factors to consider:

• Speed and predictability: When you settle onchain, payment finality and status are clear. No need to ask “Where is my wire?” or “Did I miss my payment window?” Payment stablecoins reduce and simplify downstream reconciliation work and payment flows.
• End‑to‑end costs: Fewer correspondent banks and intermediaries can mean lower total costs. Savings are most visible in small‑value, high‑frequency flows where traditional per‑payment fees hit your bottom line the hardest.
• Compliance and controls: Payment stablecoins are regulated and designed to be supervised and monitored. Regulatory clarity throughout various jurisdictions is moving the compliant stablecoin ecosystem into familiar regulatory territory for banks and PSPs.

The future of stablecoin payments

The next phase of digital commerce will be shaped by programmable money that can move as quickly and transparently as data. Payment stablecoins bring this promise within reach by combining regulatory clarity with the practical benefits of open blockchain networks. The steady rise in stablecoin payment flows, retail usage, and institutional integrations suggests we’ve already left the “pilot phase” as stablecoin adoption moves right along the innovation adoption curve.

In the near term, you can expect:

1. More stablecoins in consumer experiences: You pay in fiat, value rides on a stablecoin rail, the merchants receive local currency.
2. One‑legged B2B flow growth: Accepting payment in stablecoins is becoming more common in emerging markets with high demand for dollars.
3. Onchain FX: Stablecoin‑to‑stablecoin settlement compresses the cross‑border payment stack into automated smart contracts.
4. Regulatory guardrails: Regulatory clarity is making payment stablecoins a safe and bank‑friendly payment medium.

And while the stablecoin ecosystem is vast and ever changing, it’s worth highlighting Circle Payments Network (CPN)¹ — a compliance‑first network that connects participating financial institutions, PSPs, virtual asset service providers (VASPs), and enterprises for continuous near‑instant settlement using payment stablecoins like USDC and EURC. While much of CPN’s impact is behind the scenes, it enables businesses to pass on benefits to end users through faster settlement, lower costs, and greater transaction transparency.

For financial institutions and enterprises, CPN enables seamless, compliant transactions without the complexity of building new infrastructure from scratch. If your institution is evaluating integrating stablecoins into your payment flows, first identify your highest points of friction in existing flows. Then, identify where stablecoin flows could reduce complexity. If you need institutional access to stablecoin payment capabilities with compliance functionality, look at purpose-built networks such as CPN. You’ll keep the UX your customers expect while gaining a stablecoin payments network that reflects the standards regulators and banks require. That’s how stablecoin payments move from a promising idea to the dependable backbone of digital commerce.

Those interested in joining the network can learn more about how CPN works in our guide and register through the official CPN webpage.

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¹ Circle Technology Services, LLC (CTS) is the operator of Circle Payments Network (CPN) and offers products and services to financial institutions that participate in CPN to facilitate their CPN access and integration. CPN connects participating financial institutions around the world, with CTS serving as the technology service provider to participating financial institutions. While CTS does not hold funds or manage accounts on behalf of customers, we enable the global ecosystem of participating financial institutions to connect directly with each other, communicate securely, and settle directly with each other. CTS is not a party to transactions between participating financial institutions facilitated by CPN who use CPN to execute transactions at their own risk. Use of CPN is subject to the CPN Rules and the CPN Participation Agreement between CTS and a participating financial institution.