Stripe continued to make significant inroads into crypto and stablecoins this week by rolling out USDC checkout for millions of Shopify merchants and acquiring Privy, a wallet infrastructure provider that already powers roughly 75 million onchain accounts. This positions Stripe to build a parallel payments network that bypasses the slow and expensive traditional rails banks still rely on.
We view this as the strongest distribution moment stablecoins have seen. Over the past couple decades, only PayPal, BNPL, and Apple/Google Pay have earned real estate next to credit cards at the checkout, and Stripe is now giving USDC comparable visibility. The extent of immediate uptake will depend on whether the stablecoin option appears by default or requires merchants to toggle it on.
With Privy, we can see Stripe enabling the ability to spin up wallets at checkout, letting first-time shoppers move funds onchain instantly and complete payment in a single flow. We expect Stripe or Shopify to subsidize those first transactions—mirroring PayPal’s early playbook—to seed habit formation. When a consumer has paid with USDC once, every subsequent purchase can avoid card interchange entirely, crystallizing the merchant savings story.
We also believe the Privy acquisition signals a deliberate move up the stack toward the consumer relationship. Stripe’s core business anchors settlement with banks, Bridge handles stablecoin payouts to suppliers, and Privy closes the loop by embedding onchain identity and key management at the point of sale, giving Stripe vertical control from the end user to the fiat rails. In a way, Stripe is building what Visa feared Plaid would do years ago: a new full stack payments network. However, this differs from Visa’s attempted 2021 purchase of Plaid, which regulators viewed as having horizontal overlap. Stripe’s build-and-buy strategy is more of a vertical play in a completely new space.
We also see competitive pressure on legacy PSPs to intensify. Worldpay and Fiserv have begun to roll out or are piloting stablecoin settlements, but bank-owned processors such as Wells Fargo Merchant Services and JPMorgan Payments remain tied to interchange economics, which are directly threatened if USDC captures a large share of volume. Last month, there were reports[1] that the largest US banks are exploring a joint stablecoin issuance, which we view as a defensive response to precisely this risk. We expect PSPs to accelerate prime-brokerage-style services, OTC, and real-time FX in an effort to keep merchants that view stablecoins as a path to lower fees, faster settlement, and greater accessibility.
For merchants, the cost savings from sidestepping interchange and the elimination of chargebacks are powerful incentives. For consumers, real-time settlement and potentially programmable loyalty offset the drawback that blockchain transactions are irreversible. We therefore anticipate Stripe, and its peers will introduce insurance pools, dispute-resolution layers, and instant refund mechanisms to mirror card-network protections. In our view, Stripe’s strategic moves this week shift the debate from whether stablecoins will matter in retail payments to how quickly the rest of the ecosystem—processors, banks, and regulators—can adapt.
[1] Big Banks Explore Venturing Into Crypto World Together With Joint Stablecoin, WSJ, May 22, 2025
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Kiln is the leading staking and digital asset rewards management platform, enabling institutional customers to earn rewards on their digital assets, or to whitelabel earning functionality into their products. Kiln runs validators on all major PoS blockchains, with over $11 billion in crypto assets being programmatically staked and running over 5% of the Ethereum network on a multi-client, multi-cloud, and multi-region infrastructure. Kiln also provides a validator-agnostic suite of products for fully automated deployment of validators and reporting and commission management, enabling custodians, wallets, and exchanges to streamline staking or DeFi operations across providers. Kiln is SOC2 Type 2 certified.
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