Every innovation needs a killer use case to scale. Stablecoins, now operating under a clear regulatory framework in the U.S. thanks to the signed-into-law GENIUS Act, are still in search of theirs outside of the closed-loop ecosystem of crypto markets and trading settlement.
These cryptocurrencies, pegged to fiat currencies like the U.S. dollar, increasingly have their hopes set, like many crypto innovations before them, on retail payments.
PayPal, for example, on Monday (July 28) announced the launch of Pay with Crypto, a solution enabling instant crypto to stablecoin or fiat conversion for merchants.
In theory, the pitch is clean and compelling. Stablecoins promise lightning-fast settlements, rock-bottom fees and borderless convenience. Why wait two days for a card transaction to clear when a stablecoin could confirm in seconds? Why pay 3% on a $5 coffee when you could pay a fraction of a penny? It’s the kind of narrative that’s earned headlines and hype: that digital dollars could someday power everyday commerce.
In practice, the revolution isn’t showing up at the register. Despite years of infrastructure-building, wallet integrations and crypto-native experiments, stablecoins have yet to make a meaningful dent in retail payments. You can’t use USDC at Starbucks. Tether won’t get you a ride on Uber. In-store and eCommerce adoption remains virtually nonexistent outside a few niche crypto-enthusiast merchants.
According to data from Visa, retail‑sized stablecoin activity (small consumer‑style transfers) represents approximately $5.6 billion in volume and 118 million transactions — just 0.6% of adjusted volume.
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Instead, stablecoin rails are being leveraged more for wholesale payment flows: corporate treasury management, cross-border settlement, B2B flows. In this quiet pivot, a new thesis is emerging: stablecoins may not revolutionize how consumers buy coffee, but they might just rewire how corporates move capital globally.
“The reality is that today, stablecoins are being used for high value transfers, business to business and cross-border payments Retail transactions at merchants? Still a small part of this,” tweeted Cuy Sheffield, Visa’s head of crypto, on X.
See more: Why Stablecoins Are Stuck at the Acceptance Hurdle
Stablecoins as Digital Dollars, Not Digital Cash
Ultimately, the disconnect between retail and wholesale stablecoin use may be one of framing. If stablecoins are marketed as “digital cash,” they invite unfavorable comparisons to Visa and Apple Pay. But if they’re seen as “programmable digital dollars,” their value proposition is clearer — especially in institutional contexts.
“The crypto market cap is $3 trillion, and the stablecoin market cap is $250 billion, meaning it’s less than 10%. If you want to build a payments network, you need to solve the divide so shoppers can walk in and pay with their assets, while merchants receive the payment as stablecoin,” Mesh CEO and Co-founder Bam Azizi told PYMNTS earlier this summer.
“You need to make payments so simple that even a grandmother will use it one day, maybe without even knowing that the mechanism behind the scenes is a stablecoin … to do that, you need to do a lot of heavy lifting,” Azizi added.
Most consumer-facing wallets that support stablecoins still emphasize crypto trading or remittances — not day-to-day payments.
There are several culprits. First, the user experience remains clunky. Paying with stablecoins typically requires a crypto wallet, familiarity with gas fees and sometimes navigating layer-2 bridges or browser extensions. For a consumer used to tapping a phone at checkout, the UX is primitive.
Second, merchant integration is thin. While companies like BitPay and Coinbase Commerce allow merchants to accept stablecoins, the actual number of stores doing so is minuscule. Payment terminals and point-of-sale systems are deeply embedded — and optimized — for card networks. There’s little incentive for merchants to invest in alternative rails unless it unlocks a new customer segment or saves costs at scale.
Third, and most importantly, there’s no real pain point for the consumer. Credit cards offer convenience, fraud protection, rewards and widespread acceptance. The marginal savings of a stablecoin transaction — often fractions of a cent — are not enough to drive behavior change, especially when paired with the learning curve.
Read also: FinTech Partnerships Look to Crack Stablecoin On- and Off-Ramp Challenges
The Blockchain Back Office
While stablecoins have struggled to make inroads in consumer-facing commerce, they’re capturing inroads across one of the most antiquated corners of global finance: cross-border B2B payments and corporate treasury operations.
In international business, friction is the norm. A Singapore-based eCommerce platform paying its logistics partner in Brazil, for example, might wait two to three days for funds to clear — longer if it falls over a weekend. Along the way, the payment hops through correspondent banks, incurring fees, delays and FX slippage. Reconciliation is often manual. Transparency is limited.
For treasurers managing liquidity across time zones, these inefficiencies can compound into real financial and operational risk.
By leveraging blockchain rails, stablecoins enable near-instant settlement of dollar-denominated transactions — 24/7. More importantly, they offer atomic settlement, meaning the movement of funds and data (e.g., invoices, payment instructions) can happen simultaneously and immutably. For large enterprises and FinTechs, this can open a path to real-time cash positioning, streamlined reconciliation and programmable liquidity.
In effect, stablecoins are serving as the middleware layer between global enterprise software and local financial systems. They don’t replace banks, but they augment what banks can offer — and when.
