Stablecoins are often described as the “next frontier” for digital payments. They promise speed, programmability, and global reach, all while maintaining price stability relative to fiat currencies. Yet, as with many transformative technologies, the path from promise to mainstream retail adoption is anything but straightforward.
Today, stablecoins function more comfortably in wholesale and institutional use cases. Cross-border settlements, treasury optimization, and liquidity management are areas where stablecoins already demonstrate tangible value. Retail, however, is a different story.
Key Challenges on the Retail Front
- Intermediation vs. Direct Use – Can stablecoins achieve true ubiquity without traditional intermediaries? Card networks didn’t succeed solely on technology; they built trust, clearinghouses, and distribution channels. Stablecoins, for all their potential, have yet to replicate that infrastructure. The question remains: will merchants ever accept stablecoins directly, or will conversion layers to fiat remain an enduring bridge?
- Merchant Economics – One of the biggest open questions is how to incentivize adoption in the absence of interchange. Card networks thrived because their economics aligned consumer benefits (rewards, protections) with merchant acceptance. Stablecoins lack this model today. Unless a new incentive structure emerges — one that creates win-win value for both merchants and consumers — adoption will remain uneven.
- Clearing and Distribution – As several industry leaders have noted, clearing may be the ultimate bottleneck. Distribution cannot scale without trusted rails for reconciliation, settlement, and dispute resolution. The “Visa or Mastercard” of the stablecoin world has not yet emerged, but its creation could be the catalyst for mass adoption.
Opportunities for Innovation
These challenges should not be seen as roadblocks, but as opportunities. Programmable money opens the door to new models of incentives, fraud protection, and merchant-consumer engagement. A future stablecoin clearing layer could blend the strengths of traditional card networks with the flexibility of blockchain-based settlement.
For banks and fintechs, the five-year horizon feels like the crucial window. Incumbents will need to decide whether to adapt their models around stablecoins or risk ceding ground to entirely new networks purpose-built for programmable money.
What Comes After Cards?
Perhaps the most important question is not whether stablecoins can mimic cards, but what comes after cards altogether. Retail payments are overdue for reinvention. Stablecoins may not be the end state, but they could be the bridge to a new era of borderless, programmable retail money.