i'm still unclear what the crypto really adds to this play. stripe customers need to move their money around, and they need a trusted source to hold money. stripe could just do that. why add crypto into the mix?
Part of the very high level play is the US Govt seeks to diversify away from depending on nation states for borrowing, and to promote tech companies to the status of reserve holders.
This doesn't add much to the consumer however. I think in fact we are looking at a "fragmented currency" future where you hold like 36 different stablecoins in your wallet because certain platforms accept certain stablecoins. The GENIUS act doesn't offer strict guarantees for getting out of a stablecoin into USD, so I predict dark patterns and "incentives" to make it hard to get out of a stablecoin.
Stable coins are new enough and have not catastrophically crashed yet so there is less oversight.
It's also a very open secret that the largest Tether stablecoin is not actually 1:1 backed with USD, as they very often claim https://paymentexpert.com/2025/07/24/tether-stablecoin-regul...
However there are use cases like running a marketplace, where the platform would like to be able to direct the flow, maybe hold things temporarily in case there are multiple transactions or to split a transaction up between different clients, before paying it out daily or weekly as a lump sum. Often it’s just to avoid fees, because the marketplace operator charges their fees in a different way (like a flat monthly invoice) and they want to assist with money logic as a service, but not be the custodian of the money.
Even just knowing that money has moved at all can be useful, without any ability to touch it, and it’s difficult to get permissions from conservative financial institutions, whereas permissionless ledgers make it easy.
Crypto can help add that nuance. It’s still your money, but you can give a third party the ability to do some things to assist you, without giving the ability to transfer it all to themself and run away with it.
This would also serve to counter the drop in global Treasury demand due to recent tariff stuff where presumably our traditional debt holders are losing appetite for US debt...
It also creates a kind of strange situation where stablecoins are basically spendable "Treasury tokens". So you give 1 USD to Uncle Sam (via a middle man like Stripe), get back 1 stablecoin. Then you go and spend the stablecoin, and Uncle Sam goes and spends the USD. It's like a weird double spend situation. Prior to stablecoins, you buy a treasury bill with USD, you hold this unspendable treasury bill while Uncle Sam gets USD to spend.
I’m typing this shortly after buying my groceries with a visa debit card that was funded 30 seconds before the transaction over Lightning Network with Bitcoin that was sold at a 0.1% fee for USD and immediately then transacted on Visa debit payment network.
The reason banks are lobbying so hard recently to close “loopholes” in latest US legislation is because with stablecoins you even need them less and less to hold dollar exposure.
The days of traditional banks are likely numbered and the crypto skeptics commenting on HN have their world models upside down. At least that is my view currently.
The debit card issuer is a non-bank issuer on the Visa payment network.
LN coins are self custody origin coins.
No banks I see, except the grocery store’s on the other side of me. But soon they will accept LN directly in a few years or less.
To serve a tiny percentage of their customer base that just ends up finding an already supported method anyway?
Where exactly is the value for them?
The value proposition for everyone, consumer and vendors is both lower fees and ability to easily diversify their income/assets into non depreciating digital assets.
Somewhere there is a Steak n Shake presentation that explains their investment into accepting Bitcoin (via LN) has already paid for itself in fees.
In your world you would be the one holding the loss if your card is compromised in some way. This is of course beneficial to merchants. But as a customer I would always prefer a card network backed transaction all things being equal as my personal loss liability risk is considerably lower - almost non existent. This is why credit cards are generally better for the payer. I have no incentive other than ideological to use any crypto payment method.
PayPal, Venmo, Cash App tend to not be merchant based transactions but cash like transactions by either people that are unbanked for whatever reason, or doing business person to person, or transacting with a merchant who doesn’t accept credit cards. Stripe (and square) make the logistical side of that less an issue than it was, and today it’s mostly about fees and loss liability transfer back to the originator of the money (as in a theft scenario it’s not the payer whose money is at risk).
Paypal has USD savings accounts that pay interest, ACH support, and also issues standard credit cards if you like. On top of that they support multiple major cryptocurrencies and allow instant conversion to USD.
A high percentage of restaurants and stores in my area now accept CashApp payments directly along with other payments. Many people are using PayPal and Venmo also with merchants in person, and online Paypal is dominate.
Square is in the process of rolling out Lightning Network Bitcoin payments to all it’s POS terminals later this year with the merchant having control over how they want to handle such payments, auto convert, partial convert, custody Bitcoin. Could get interesting fast if merchants start offering discounts for non-credit card transactions, which they are fortunately now allowed to and the credit card companies can’t terminate them, what happens when USD stablecoin or Bitcoin payments are offered further discounts by the merchants due to their cost savings and preference?
I’m thinking about moving all my ACH auto pay payments over to either CashApp or Paypal also. And remember they both support ACH direct deposits.
What services are left for the traditional bank to provide me? FEDwire and international SWIFT wires … and … investment accounts for stocks and bonds …
I’d say they are on shaky ground as I know crypto focused companies like Coinbase are looking at how to get into traditional equities and bonds and guess what Robinhood already does that and has gone the other direction and acquired crypto companies.
The bigger mystery in all this discussion is why such a significant fraction of HN readers and commenters are so out of touch with what is happening in the real world and real economy with these systems?
For bank transfers, again, you gain repudiation. You have a window during settlement to dispute the transfer. It’s short but it exists. This is seemingly inconvenient and not obviously useful until someone is trying to steal your money. Then it’s suddenly very useful.
As a general society the friction that transfer hold periods provide generally globally reduces financial crimes everywhere and provides global stability to the financial system that didn’t exist prior. These seem like stupid fuddyduddy things banks do but there was a time these didn’t exist and there was a reason they were created and that time was not a better time. It was materially worse for everyone everywhere. Having never existed in such a time makes it hard to understand that such a time might have existed and why it was bad - but for those interested there do exist books that explain how we got here.
Obviously time will tell if there's enough margin to even offer a valuable discount to the purchaser and if merchants will become savvy enough to offer this dual pricing scheme.
In developed states (so, not the USA), regulation that protects the consumer.
I wouldn't write off banks that quickly.
[1] https://www.federalreserve.gov/monetarypolicy/reservereq.htm
Crypto isn’t going to take over anything.
The processing fees are lower for vendors than credit card fees if they accept LN Bitcoin. For me the “savings” account is completely self custody held in a non-inflationary non-depreciating currency called Bitcoin.
Massive value for everyone by cutting out the legacy banks. As I said earlier, unless you actually do it, and use it, you won’t understand how rapidly crypto is embedding itself and likely will take over in next decade for sure.
it's flawed and it can be improved, no question, but improvements need to reflect a basic understanding of the lessons learned by past experience, regulations were created for a reason, etc.
I think I'm confused. You paid 0.1% on this transaction, but if you'd done it with just a Visa debit card tied to a traditional bank account you would have paid 0.0%.
Am I missing something?
Some cryptos are doing better than that, so it's certainly possible to beat, but I wouldn't chance the volatility. Unless it's doing better than that.. then I think inflation is eating the crypto, not the other way around?
Edit: I see, because Bitcoin isn't adding additional coins, it's "non-inflationary". I think this is moot when you ultimately have to transact through fiat, so the only thing that matters is BTC-USD conversion rate.
0.1% is fee to convert to USD and in context of converting anything to USD, like stocks or anything one would hold in an investment account it’s a low fee. This means I keep my liquid capital in Bitcoin which has a strong tendency to increase in value and yet whenever I need to spend it, it’s instantly spendable in multiple ways, literally instantly and for a very very low conversion fee.
I can also use a CC company and I agree there is a 2% cash back. There are multiple companies that are crypto focused and have issued CC and Paypal issues CC and I can settle the monthly balance using Bitcoin also.
What I predict is coming soon, maybe next year or so, if POS support in the US to offer that 2% cash back directly to the consumer from the merchant should they settle in alternative currencies, like Bitcoin, like USD stable coins.
The combined issue of interest payments on stable coin balances (custodial) and legal settlement rebates is what has the banks literally freaking out and starting to try and spread FUD about USD stable coins. They know their business models in the payments space is eroding and soon the money markets space is under pressure.
What is blocking its adoption?
One I can think about is it is hard to accept that if I pay $20 for a pizza today, 6 months later that pizza might have cost me $40. It is a bit irrational but it will prevent most people from using it.
This is where the stablecoin thing is genius, one can decide/optimise when get in and out of crypto.
There's no native web experience that makes it easy to use Lightning in a browser; this forces everyone to step outside the box to figure out a way to (e.g. install extension or download an app)
There's also not much of an app ecosystem for it providing enough utility for people to use it each week/day
The core Ethereum stuff is pretty elegant but once you want to build an UI you get trapped in hell to plug it to the "web".
Maybe the biggest problem of "Web3" is it was built on Web2.