Although institutional adoption of stablecoin technology is at an all-time high, business adoption remains one of the barriers to bringing these digital assets into more widespread use.
For many businesses, the challenge isn’t necessarily whether they want to accept stablecoins, but how to do so without taking on new technology and operational complexity. One approach is to make the underlying technology largely invisible to the business. Citi and Coinbase, for example, have developed a system that will allow Citi’s business clients to offer stablecoin payments at checkout without adding new infrastructure.
This means that business customers would not need to handle tokens or wallets. Instead, the conversion process occurs automatically. Coinbase converts stablecoins to dollars, and Citi handles the payment from there. Similarly, Coinbase’s business customers can open Citi-administrated accounts through which payments are converted from dollars to stablecoins.
“Most businesses don’t want to manage wallets or digital assets, they want to get paid,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Giving them another way to accept payments without adding those operational complexities makes adoption much more obtainable.”
Offering Turnkey Solutions
Turnkey stablecoin solutions could be attractive to merchants interested in offering crypto and stablecoin payments to their customers. For businesses that lack the infrastructure or expertise to manage digital assets directly, having the conversation and settlement processes handled by established financial and technology partners can simplify adoption.
That same infrastructure challenge applies to financial institutions. Coinbase and financial services provider Moov recently unveiled a platform built to bring stablecoin payment and settlement capabilities to community banks and credit unions. The objective is to enable smaller institutions to accept stablecoins without having to build the underlying infrastructure themselves.
Making the Tech Invisible
The appeal of these solutions is partly tied to the potential benefits of stablecoins, including faster settlement, lower transaction costs, and 24/7 availability.
However, infrastructure gaps remain for both merchants and financial institutions, creating hurdles for broader stablecoin adoption. By handling functions such as conversion, payments, and settlement behind the scenes, solutions such as those developed by Citi and Coinbase are designed to reduce the amount of new infrastructure businesses need to manage themselves.
“What stands out is that Citi will stay in the middle of the relationship, at least for now,” Hugentobler said. “This shows how banks can participate in stablecoin payments without having to issue a coin themselves. Making the tech ‘invisible’ removes some barriers, but the business case of lower total costs and faster access to funds will still need to hold up.”
