TL;DR in this announcement seems to match: more control over rewards/yield (both in entitlement _to_it, and in the ability to customize the portfolio that generates it).
Agreeing with your immediate hunch that the traditional rails are sufficient for agentic commerce, but still finding the x402/stablecoin etc work fascinating:
Under which circumstances are the traditional rails actually off limits? Some (trivial) speculation being:
- When the beneficiary is not a traditional business but itself some sort of protocol / contract (that benefits from or even requires final settlement into eg. a stablecoin wallet, eg. to pipe those funds into downstream dependencies) - nothing with mainstream PMF here yet, but feels like the "trivial" case for those rails
- In cases where "broad commercial relationships" around low-cost txns aren't feasible -> credit risk can't be pooled, there isn't credit infra, etc -> market never clears. Global micro-payments to regions with no local acquiring/robust banking? Something else?
(yes, very guilty of solution in search of a problem thinking :))
>why people who actually like crypto would want paypal
this snippet is everything: "to PayPal, Venmo, as well a rapidly growing number of digital wallets across the world that support crypto and stablecoins"
this is effectively PayPal taking its "closed-loop" payment network, and opening it up to any wallet capable of receiving crypto/stablecoins - which is still a big deal.
your counterparty no longer has to have a PayPal account for you to pay them via PayPal - they can have any crypto wallet and get paid by you - which is in line with much of the crypto vision around global interoperability/payment acceptance/etc. you could compare to Visa/card acceptance as another global payment rail - but the difference here is closer to the difference between global card payments (easy) and global bank transfers (hard)
>Now, why would anyone buy a branded stable coin that explicitly doesn't promise a return?
In practice, you're not even buying these (or at least - that is not the presentation). What you're actually doing is making a deposit into a "stablecoin" account at a place like Stripe (who now offers a Stripe Stablecoin Account, denominated in the USDB custom stable), Slash.com, Dakota.xyz, etc. IIRC Mercury is also a design partner of Stripe's blockchain.
When you make that deposit - either from your regular bank account via ACH/wire, or via USDC - it settles into the account as the branded stablecoin. When you send funds out - you're either sending as fiat or as USDC.
In short - you're not proactively "buying" the coin, and in fact - Stripe describes [0] the USDB coin as closed-loop & "not for public sale", and I think the others are the same. You're just depositing your funds into a platform, in order to use them on-platform - and the platform is holding them as a "custom stablecoin."
>Assume the buyer/seller holds capital from sources that the majority of the market considers “illicit” and/or is legally sanctioned and/or physically frozen or restricted
This is not feasible legally, and is where your claim falls apart.
From the now-passed GENIUS act [0] which regulates the stablecoin issuer:
- "Permitted payment stablecoin issuers must maintain reserves backing outstanding payment stablecoins on at least a one-to-one basis, consisting only of certain specified assets, including US dollars and short-term Treasuries."
Their point is that if the money held in reserve are proceeds from criminal activity, it is possible for the assets to be seized or frozen by the feds (which would render them no longer backed 1-to-1 even if they were before then). The text of the law you quoted doesn't really change anything.
I see, I misread: that’s interesting. I would assume the issuer would still be liable to resolve the backing, but yeah I could see how that poses systemic risk.
I also don’t think such a risk could realistically remain hidden - this is still going to be heavily regulated and audited, and industry will wise up to the sorts of risk that emerge.
I think there is plenty of counter-evidence in how this is being approached:
- The obvious: these are stablecoins, whose value is pegged to and 1:1 backed by fiat currency / is not capable of the cliche pump&dump dynamics of other crypto tokens.
- To the extent that (eg. today) they are coupled to a network like ETH or Solana (whose holders stand to gain) - both Stripe and Circle are building L1 blockchains right now whose native gas tokens are stablecoins, and are therefore also decoupled from any of the bagholder stuff. Merits of those chains aside: the big players want to further eliminate that dynamic and are putting their money where their mouth is.
- Stripe (and other legitimate fintechs) want to use stablecoins specifically because they legitimately make cross-border payments much easier, and because there is serious/earnest usage emerging. SWIFT actually does suck (not just to the cliche engineer-who-wants-better-APIs way, but even a banking professional would tell you), international payments are more unsolved than you think outside of a few fintechs who are basically just managing massive ledgers + a ton of liquidity around the world.
(In short: I think your take is something that may have made more sense 5-10 years ago, when Stripe themselves ditched crypto for the reasons that it didn't work for anything useful and was primarily a means of gambling)
Crypto was never gambling. It's a wealth redistribution scheme.
I don't trust stablecoins that are built on the same technology, by the same actors, and are then used to facilitate most of crypto's trading volume.
I am not convinced of their backing, and I think it likely that together with the crypto collapse stable coin issuers are going to fall like dominos too.
As for Stripe, they announced that their first customer for this is some Argentinian bike importer. We will see if it's that useful a tool in the future. It's not yet the case.
This is a great question, I actually don't even think it's strictly a matter of "more" yield.
To dig into your example a bit deeper, there are a few general differences with an (eg.) Unit vs. Bridge.
- With a BaaS like unit, you're often actually forming a partnership _not just_ with Unit (a software provider), but the partner banks Unit works with. More specifically, you're operating two sorts of programs with the partner bank: programs around "money transmission" (_moving_ money on behalf of customers) and around "stored value" (_storing_ money on behalf of customers). Each of these programs tends to be pretty involved - as is having to be in a three-party agreement etc, working with an old-school bank, under legacy banking constructs, etc.
- With Bridge: Bridge is your single partner. Bridge _itself_ has partner banks for the sake of both banking + money movement, but when you store customer funds as stablecoins in a crypto "wallet" Bridge spins up, it is operationally different than if you were to store them as fiat in a customer-specific bank account you opened at Bridge's partner bank, under a classic FBO/DDA program. The partner bank Bridge using is more involved in the money _transmission_ piece, when you want to receive customer funds in as fiat, or push customer funds out as fiat - but the funds being stablecoin at rest would seem to reduce the burden here.
So yes that might result in some cost-saving, but it's also just (vaguely) _easier_ to do from a technical/operational POV.
(Some of the details above may be wrong / vary by provider / etc - but having worked with both of these sorts of providers at some length, this is my "felt" difference and high-level understanding).
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