It's all about moving money at internet speed. With cryptocurrency being integrated into popular traditional payment solutions, the world is about to be exposed to money transfer systems that settle like sending a text message.
Interest in stablecoins from traditional tech and finance firms are growing, the most recently reported company to be exploring this is Meta and we can already imagine what a successful implementation would look like for the world, given the company's capture of the global population across its giant social media business.
But to stay on topic, Stripe has recently announced the release of stablecoin financial accounts, available for 101 countries.
With this, Stripe users can receive, store and move value around in stablecoins. Of course, this is built to be flexible and compatible with traditional finance money transfer systems, meaning that transactions can go from stablecoins into regular bank accounts and vice versa.
Stripe being a payments powerhouse, especially for digital businesses and remote employees, the addition of stablecoin payments not only serves businesses well, but regular people.
Developments like this are a big deal for the cryptocurrency ecosystem because it accelerates the adoption cryptocurrencies and contrary to what most people think about institutions issuing stablecoins and running payments solutions atop it, this will not be a case of big tech or top investment firms centralizing and essentially exploiting the cryptocurrency ecosystem.
You see, most people seem to be deluded with the idea that people are just going to come along, use services like Stripe and stick with it. When, in reality, people will come along, discover the value in cryptocurrencies and eventually move away from Stripe to make direct P2P transactions.
The biggest motivation for this will be fees, both for businesses and for users.
Accelerating cryptocurrency adoption
When payment companies like Stripe embrace stablecoins, they make way for employers to get familiar with the world of cryptocurrency, essentially accelerating adoption.
The flaws of traditional payment systems for years has been that it limits the free flow of value into and out of global economies.
If employers cannot easily pay for services across the border of their country of residence, then digitally growing their talent team and effectively their businesses is restricted.
Cryptocurrency solves this and when traditional payment systems begin to adopt and build out solutions for this, they essentially do all the marketing that needs to be done for the cryptocurrency industry.
Understanding that these companies serve millions of businesses and billions of consumers, it's all really a huge deal.
Companies like Stripe will build out the payment products, promote to their users, experimentation will begin, and before anyone realizes, transactions now go from Stripe accounts into regular crypto wallets given that it's the most flexible and low cost option.
Eventually, these regular people receiving payments in crypto will seek ways to spend their money without having to convert to fiat and incur fees, now we have a case of these values moving into the pockets of businesses.
Naturally, businesses will try to save costs by any means necessary and what saves cost better than a simple payment address on their website as opposed to accepting payments through Stripe and paying more than necessary?
There's bound to be intense competition amongst payments giants with this new tech and fees will be a major deciding factor but eventually, I imagine that most transactions will move to be P2P and the only business profits any of these firm can have would be from marketing their stablecoins so that more people want to transact in them, thereby giving them USD reserves they can push into treasuries for yields.
It really is the most likely outcome in the long run. Payments in itself will eventually be P2P because that has always been the whole point of cryptocurrency.
So whilst some people are beginning to fear that traditional systems will custody and centralized most cryptocurrency transactions, I happen to expect quite the opposite because when people learn that they can pay less or even pay nothing(for feeless blockchains) to move their wealth around and pay for day to day expenses, not many will choose to stay on these centralized payment systems, no matter how convenient it may seem.