This week’s highlights:

Just two weeks after rolling out its own stablecoin, Klarna announced plans to explore a proprietary crypto wallet. The “stablecoin + wallet” pairing is fast becoming a low-cost upgrade path for credit-driven fintechs (BNPL players in particular) to evolve into account-based monetary platforms. Stepping back, why are more fintech companies ultimately gravitating toward wallets and stablecoins? And how might this architecture open up new revenue streams and growth levers for BNPL, a model long constrained by thin margins?

Meanwhile, Stripe introduced support for stablecoin payments but kept its 1.5% fee, reigniting debate around pricing in the payments industry. As the marginal cost of settlement trends toward zero, the sector’s profit pool is shifting from “toll-taking on transactions” to software and financial orchestration. In this reshaped landscape, how can Stripe—by outsourcing complexity and offering high-value services—rebuild its pricing power and rethink its path to profitability?

Market Overview & Growth Highlights

Total stablecoin market cap reached $310.001b, with a week-over-week increase of $1.883b. In terms of market structure, USDT continues to maintain its dominant position at 60.05%; USDC ranks second with a market cap of $78.56b, accounting for 25.34%.

Blockchain Network Distribution

Top 3 Networks by Stablecoin Market Cap:

1. Ethereum: $166.268b

2. Tron: $81.308b

3. Solana: 16.473b

Top 3 Networks by Weekly Growth:

1. Resolv USD (USR): +55.96%

2. USDD (USDD): +14.91%

3. Sky Dollar (USDS) :+5.95%

Data from DefiLlama

🎯Klarna’s Next Chapter: From Credit Rails to a Monetary Platform

Following the launch of KlarnaUSD, its Tempo-chain–based stablecoin, Klarna this week announced a partnership with Privy to explore building its own crypto wallet. On the surface, it’s just another major consumer finance player stepping into crypto. But in practice, Klarna is attempting to bring the user-asset relationship fully inside its own ecosystem. With the stablecoin as the value container and the wallet as the entry point for funds, Klarna can—for the first time—directly capture users’ stored value and payment flows, moving from a mere transaction facilitator to a financial node. For a company built on “buy now, pay later,” this represents a fundamental redefinition of its relationship with the monetary system itself.

At the business-model level, the shift cuts directly into Klarna’s core. BNPL is, at its heart, a credit business: Klarna advances payments to merchants, records receivables, and earns from credit spreads. It is capital-intensive, risk-heavy, and tightly constrained by regulation and balance-sheet limits.

Stablecoins and wallets flip this logic. By controlling both the primary account relationship and the payment pathway, Klarna can evolve from a credit intermediary into a funds intermediary—earning not from underwriting risk, but from facilitating liquidity. When customer balances sit, even briefly, in a Klarna-controlled wallet, they become productive: generating float yield, FX spread, and powering new merchant-side financial tools. Profit moves from lending and risk to liquidity and capital efficiency.

The engine behind this shift is the structural nature of stablecoins. Unlike traditional deposits, fully reserved stablecoins do not create credit or engage in maturity transformation—they resemble a “narrow-bank” model. This lets platforms control user funds without becoming regulated deposit-taking institutions. What users hold in the wallet is an on-chain asset, not a bank liability. That allows Klarna to build an internal loop for value storage and settlement—without capital-adequacy requirements, Basel III obligations, or the compliance overhead of bank balance sheets—while still capturing the economics of money movement. In effect, Klarna is using software to step into a profit pool that was once reserved for banks.

Zooming out, this underscores a broader shift in fintech’s competitive frontier. As digital dollars and on-chain payment networks go mainstream, innovation is moving from front-end experiences—payments UX, credit scoring, merchant tools—down into the monetary-relationship layer itself. If the last decade of fintech revolved around installment loans and credit efficiency, the next decade may be rebuilt around the triad of accounts → stablecoins → wallets. For platforms with large user bases, stablecoins aren’t just a cross-border payments tool—they are a foundational financial rail capable of reshaping revenue models and redefining the user relationship.

🎯Stripe Adds Stablecoin Acceptance — and Sparks a Pricing Backlash

In a new merchant communication, Stripe announced that beginning December 12, 2025, stablecoin acceptance will be enabled by default. Merchants don’t need to update their code; stablecoin payments made by users will automatically settle into their existing accounts in USD.

For merchants, this is a major win: access to crypto-native users, faster settlement, and dramatically lower operational friction. Stripe charges a 1.5% fee, with no fixed costs.

Reasonable at first glance—yet the fee immediately became the center of controversy.

What’s the debate really about?

By all logic, stablecoin payments should be dramatically cheaper than traditional rails: instant settlement, no clearinghouses, no correspondent banks, and network gas fees that can be near zero on certain chains. And yet Stripe is applying a credit-card-style 1.5% take rate, almost entirely decoupled from real cost. For a $100,000 payment, the on-chain cost might be a few cents—Stripe earns $1,500.

When the marginal cost of value transfer falls to near zero, charging a percentage of transaction volume starts to look like an artifact of a bygone era. Stablecoins redefine how money moves: collapsing intermediaries, compressing latency, turning settlement into code execution. In an efficient market, pricing should converge toward actual cost. Stripe’s insistence on value-based pricing rather than cost-based pricing is the core of the debate.

But calling the 1.5% “exploitation” misses the point

Payments are not simply “sending bytes or tokens.” Stripe is far more than a transaction pipe; its core product is packaged trust at scale.

The 1.5% fee funds a vast set of invisible but essential layers: risk modeling, refunds, dispute management, fraud detection, compliance, liquidity, support — and subsidizes the merchant-facing product layer: Checkout, API orchestration, analytics, subscription tooling, and multi-chain routing.

In other words, merchants aren’t paying for an on-chain transfer. They’re paying to outsource an entire universe of complexity. Stripe’s value is turning “programmable money” into a turnkey payment experience—abstracting the messy interplay of on-chain assets, compliance, risk, and legacy payment methods so stablecoins feel as seamless as card payments.

Still, the long-term pricing model is unlikely to hold

Stripe is simultaneously building higher-value enterprise financial capabilities:

• Tempo, which rearchitects underlying settlement;

• Metronome, which introduces enterprise-grade billing and usage-based pricing;

• and upcoming AI-driven systems for risk, dispute resolution, and operational automation.

These layers can support a new revenue model—moving the business from “charging for access to a payment rail” to monetizing intelligent financial orchestration.

Seen through this lens, the 1.5% fee is less a permanent stance and more a transitional price that preserves merchant experience while Stripe matures its upper-layer software stack. As stablecoins drive settlement costs toward zero, the industry’s profit pool will migrate upward—from the transaction rail to the coordination and intelligence layer.

Future pricing may be tied not to the size of a transaction, but to the business value the merchant derives: cross-border cost savings, consumption of subscription APIs, or enterprise bundles that integrate settlement, risk, and billing into a unified service.

New Launches

👀Tassat has secured a U.S. patent for its “Yield-in-Transit” on-chain settlement technology, which accrues and allocates interest at block-level and intraday granularity during the settlement process, clarifying who earns yield at the precise moment ownership changes. The technology underpins Lynq, the institutional settlement network Tassat and partners launched in July 2025 to boost capital efficiency for market makers, custodians, and stablecoin issuers. More than 50 institutions are integrating with Lynq as demand for high-efficiency on-chain clearing grows alongside RWA, stablecoin, and broader crypto-market expansion. If widely adopted, this ability to pay yield during the “in-transit” phase of an asset could reshape capital efficiency and yield allocation in on-chain settlement, providing the fine-grained financial infrastructure needed for large-scale institutionalization of RWAs and stablecoins.

👀Coinbase-incubated AI payments protocol x402 has launched V2, upgrading into a unified payments layer that standardizes multichain and asset identification, enabling “multi-chain by default” while integrating with ACH and card networks. In its first six months, x402 has processed over 100 million payments across APIs, apps, and AI agents, adding customizable payment flows and dynamic payTo routing. Developers can use lifecycle hooks to build subscriptions, usage-based billing, and multi-step transactions, with Cloudflare and Coinbase jointly supporting the ecosystem. x402 is abstracting value transfer into standardized infrastructure, allowing AI agents and applications to natively access cross-chain and traditional payment rails, forming a foundational protocol for the machine economy and next-generation internet payments.

👀Exodus will launch Exodus Pay in early 2026, enabling users to store, transfer, and spend stablecoins directly from a self-custodial wallet while supporting card payments and Apple Pay. Transfers can be made via phone numbers, and users earn rewards for holding and spending—without ever giving up control of their private keys. Targeting younger users who are moving away from traditional banking, Exodus aims to lower the barrier to real-world crypto payments through stablecoins. This reflects the shift of stablecoins from trading instruments to everyday payment tools, with self-custody allowing on-chain digital dollars to enter consumer spending and pushing wallets to evolve from asset managers into payment gateways.

👀Tether has launched QVAC Health, a privacy-focused wellness app that stores all user data offline with local encryption and avoids commercial servers, emphasizing “local intelligence.” The app is built on Tether’s decentralized AI platform QVAC, enabling AI agents to run directly on devices without centralized cloud infrastructure. Recent investments in Generative Bionics and Blackrock Neurotech expand Tether’s reach into robotics and brain–computer interfaces, signaling a push far beyond financial services. As the world’s largest stablecoin issuer, Tether is using its capital and technical resources to build an AI and privacy-tech footprint outside traditional finance, marking a strategic shift toward decentralized infrastructure and local AI that could redefine its role in both the crypto and broader tech sectors.

👀Flowglad has introduced a zero-Webhook, open-source payments system that generates integration prompts tailored to a developer’s codebase and pricing model, enabling AI agents to complete SaaS billing integration in a single pass. The platform also serves as a single source of truth for billing, removing the need to maintain multiple mappings for prices, plans, and user permissions or store payer IDs locally. Its open-source codebase includes 130,000 test cases that AI can directly parse to cover edge scenarios, reducing documentation reliance and eliminating Webhook-related race conditions and sync issues. Flowglad abstracts away the fragility and tight coupling of traditional SaaS payment integrations, positioning itself as a key component of AI-native billing infrastructure.

👀Stripe-backed payment chain Tempo, co-developed with Paradigm, has launched its public testnet, offering native stablecoin gas fees, a built-in DEX, 0.5-second finality, and passkey-based biometric login as core payment features. Since its September reveal, Tempo has added 14 new design partners—including Brex, Klarna, Mastercard, and UBS—and attracted 40 infrastructure partners for testing. The client has been open-sourced under the Apache license, with partners piloting cross-border remittances, global payments, embedded finance, and tokenized deposits. The team behind Tempo has also built an extremely fast open-source block explorer using Cloudflare Workers and indexed data, costing only a few dollars per month to maintain (assuming RPC usage). Tempo aims to provide a high-performance stablecoin payment network for enterprise-scale applications, accelerating the shift from experimental to large-scale on-chain payments and signaling the full entry of traditional payment giants into dedicated blockchain infrastructure.

Regulatory Compliance

🏛Poland’s parliament failed to secure the three-fifths majority needed to override the president’s veto, leaving the Crypto-Asset Market Act rejected by a margin of just 18 votes. The president argued the bill was overly burdensome and could drive companies abroad, while Prime Minister Tusk pushed for its passage on national-security grounds, citing crypto misuse by Russian intelligence and criminal groups. As countries like Germany and Malta already issue MiCA licenses, Poland remains the only EU member without a local MiCA framework, even as its crypto trading volume grows over 50% and users near eight million. The regulatory deadlock highlights political divisions within the EU over MiCA implementation, prolonging uncertainty for crypto businesses and increasing pressure for a more centralized, cross-border supervisory model.

🏛Bipartisan senators and major bank CEOs have made progress on a comprehensive market-structure bill spanning the SEC and CFTC, with Senators Gillibrand and Lummis set to release a draft this week, followed by hearings and a vote next week, aiming to deliver it to President Trump in early 2026. The package covers yield-bearing assets, stablecoins, DeFi, and the definition of “ancillary assets.” The CFTC’s acting chair has withdrawn the 2020 “actual delivery” guidance, opening room to reshape the crypto-commodity framework, while the OCC has simultaneously signaled support by opposing limits on bank crypto custody and allowing “riskless principal” crypto trades as core activities. Industry lobbying is consolidating as the U.S. Digital Chamber absorbs the UK’s CryptoUK to build a unified transatlantic voice during a pivotal legislative window. These moves mark a rare alignment across agencies and branches, shifting the U.S. from fragmented oversight toward systemic restructuring that elevates institutional participation and could redefine how global crypto businesses position themselves in the American market.

🏛 The UK’s Financial Conduct Authority (FCA) has named support for domestic stablecoin payments as a 2026 priority and is working with the Bank of England on a comprehensive framework covering trading, lending, and custody. The FCA has opened a stablecoin regulatory sandbox with applications due January 18, and digital assets have gained statutory property status this year. The UK is pursuing a phased regulatory strategy to balance innovation and consumer protection, though critics say it lags behind the U.S. in speed. Stablecoins are becoming a focal point of national financial-infrastructure competition, and the UK’s push for local issuance and regulation signals an effort to reclaim leadership in compliant crypto finance.

🏛Nearly 200 consumer and financial-reform groups, along with multiple labor unions, have opposed the Senate’s crypto market-structure bill, arguing it fails to address fraud, conflicts of interest, and regulatory exemptions while potentially weakening existing securities-protection frameworks. The American Federation of Teachers (AFT) also urged withdrawal of the Responsible Financial Innovation Act, warning it could expose pension systems to crypto and stablecoin risks and allow companies to sidestep registration and disclosure requirements via tokenization. Progressive Democrats are increasingly split, and environmental groups have joined the opposition, underscoring mounting political resistance as the Senate advances a framework different from the House version. The backlash from pension and consumer organizations highlights deep U.S. divisions over whether—and how—to integrate crypto assets into the mainstream financial system, raising the likelihood of delays or rewrites and adding uncertainty to the regulatory timeline.

🏛Argentina’s central bank is considering easing its current ban that prevents banks from trading or offering services related to digital assets, with possible implementation as early as April 2026. Local exchanges and experts say bank participation would drive mass adoption, and Argentina processed $93.9B in crypto transactions from 2022–2025, ranking second in Latin America. Brazil has already advanced a more comprehensive regulatory model requiring central-bank licensing for crypto service providers, offering a regional reference point. If Argentina opens the door for banks to engage in crypto, it would greatly expand compliant access, reshape competition in the Latin American market, and accelerate regulatory harmonization across the region.

Capital Deployment

💰Stripe has acquired the self-custodial wallet Valora’s team (excluding IP) to expand its stablecoin product stack, while the Valora app returns to Celo developer cLabs. The deal follows Stripe’s purchases of Bridge and Privy and its launch of the Open Issuance platform and involvement in the Tempo chain, building end-to-end capabilities for stablecoin issuance, management, and custody. Valora’s expertise in mobile stablecoin payments and deployment in regions such as Africa strengthens Stripe’s global reach and on-chain payment experience. The move shows payment giants accelerating acquisition of crypto-native talent as stablecoins become core to next-generation global payment networks. Stripe’s modular strategy highlights traditional tech companies competing for dominance in stablecoin infrastructure.

💰Tether has joined AMD Ventures and Italy’s National AI Fund in an €70M round for Generative Bionics, a company developing “Physical AI” humanoid robots for high-risk industrial and logistics environments. The investment extends Tether’s strategy of expanding beyond stablecoins into AI and physical infrastructure, including brain–computer interfaces, large GPU clusters, and Bitcoin mining. Generative Bionics aims to deploy its first mass-production systems across manufacturing, logistics, healthcare, and retail by 2026. The move signals Tether’s systematic push into critical technologies and industrial assets, building a diversified infrastructure portfolio to strengthen resilience and expand its global technological footprint.

💰Paradigm has made its first bet in Brazil, leading Crown’s $13.5M Series A at a $90M valuation; Crown’s BRLV, a Brazilian-real stablecoin fully backed by government bonds, has become the largest emerging-market stablecoin with about $66M subscribed. BRLV offers institutions on-chain access to Brazil’s 15% benchmark rate, solving the “zero-yield” disadvantage of USD stablecoins and positioning Crown as an institutional, yield-bearing local-currency issuer. Brazil, the world’s fifth-largest crypto market, already has more digital-asset investors than stock investors, and Crown projects BRLV could reach 1T reais in circulation within a decade. Local-currency stablecoins are emerging as a new gateway for global capital to tap high-rate economies, potentially reshaping stablecoin competition and cross-border capital flows. Paradigm’s entry underscores the rising strategic value of emerging-market stablecoins.

💰A16z-backed innovative commercial bank Lead Bank has integrated Loop Crypto to bring stablecoin payments into the banking system. Loop Crypto, a stablecoin payments processor, joins the Missouri-based community bank to combine a banking charter with on-chain payment capabilities. Lead Bank, revamped after a tech-team acquisition, has evolved into a fintech- and crypto-focused institution with $70M raised at a $1.47B valuation, serving clients like Affirm, Ramp, and Stripe’s Bridge. Loop secured strategic investments from VanEck and Fabric this year, with payment volume up 344% as bank partnerships deepen integration between on-chain settlement and traditional networks. This signals a broader shift as U.S. community banks adopt crypto infrastructure, embedding stablecoins into mainstream banking and reshaping payment rails.

Market Adoption

🌱Revolut has integrated with Trust Wallet to offer EU users instant crypto purchases via Revolut Pay, cards, or bank transfers, with assets delivered directly into self-custody rather than passing through a centralized exchange. Selected transactions can be fee-free at launch, supporting BTC, ETH, SOL, USDC, and USDT, and Trust Wallet reports more than 220 million users globally. With its MiCA license, Revolut is accelerating expansion, recently reaching a $75B valuation and advancing cross-border crypto payments and global banking initiatives. As regulation tightens and self-custody demand rises, major fintech firms are adopting “buy-to-wallet” flows as the primary user on-ramp, potentially shifting Europe’s crypto landscape from exchange-centric to wallet-native models.

🌱JPMorgan has issued a USCP token on Solana to support Galaxy’s first commercial paper offering, with issuance and redemption settled in USDC. Coinbase and Franklin Templeton participated as purchasers and provided custody and USDC on/off-ramps, making this a rare institutional-grade debt issuance on a public blockchain. The transaction reflects rising institutional interest in on-chain money-market instruments, and Galaxy is continuing to migrate financing and equity structures on-chain as it experiments with programmable financial infrastructure. The involvement of major banks and asset managers in tokenized commercial paper indicates that traditional capital markets are beginning to move high-grade short-term debt onto public chains, catalyzing the early formation of a compliant, scalable on-chain money market.

🌱Oobit has partnered with Bakkt to launch its crypto tap-to-pay service in the United States, enabling payments from non-custodial wallets such as Base, Binance, and Phantom while merchants receive instant fiat via Visa rails. Bakkt provides the compliance and licensing foundation across all 50 states, aligning with the U.S. push on stablecoin regulation through the GENIUS Act and Tether’s expansion via its USAT stablecoin. Oobit, which raised $25M in a 2024 Series A led by Tether, recently migrated its OOB token from Ethereum to Solana and secured a $100M token investment commitment from VCI Global. Oobit’s U.S. entry signals rapid convergence between stablecoins, on-chain wallet payments, and mainstream merchant networks, strengthening Tether’s strategic footprint in the U.S. and Europe through ecosystem and regulatory pathways.

🌱Tether has partnered with fast-growing African fintech HoneyCoin, which will roll out a cashless POS system supporting USD₮ so merchants can accept stablecoins directly and reduce payment costs. HoneyCoin will integrate USD₮ across online and offline payments, real-time FX conversion (KES↔USD₮), QR payments, and merchant dashboards, enabling lower-friction cross-border commerce and protection against local-currency devaluation. On-chain transaction volume in Africa grew about 52% YoY to $205B in 2024–2025, driven by stablecoin demand and a large underbanked population. In a region marked by currency volatility and weak financial infrastructure, stablecoins are becoming practical tools for payments and value storage. Tether’s partnership accelerates stablecoin adoption in retail and cross-border trade, advancing the shift from “trading token” to “real-economy payment network.”

🌱PNC Private Bank has become the first major U.S. bank to offer spot Bitcoin trading directly inside online banking, using Coinbase for infrastructure so clients can buy, sell, and hold BTC within their existing accounts. Coinbase provides custody, trade execution, and compliance, allowing PNC to offer crypto exposure without holding digital assets on its own balance sheet or registering as a crypto broker. The collaboration began R&D in 2021 and was publicly announced in July 2025, enabling PNC to meet high-net-worth client demand while deepening Coinbase’s integration into traditional finance. This marks a significant step as large banks bring Bitcoin into core online-banking systems, accelerating mainstream financial integration and validating the regulatory and commercial viability of the “bank-as-crypto-on-ramp” model.

Big Picture

🔮The European Central Bank says that if digital-euro legislation passes in 2026, pilot testing and initial transactions could begin in 2027, with full issuance readiness by 2029. Designed as a “digital complement to cash,” the digital euro will be free, simple, usable across the euro area, support both online and offline payments, and offer “cash-like” privacy to ensure universal accessibility. The project aims to strengthen Europe’s strategic autonomy in payments and reduce dependence on non-European payment giants, mitigating technological and economic security risks. The digital euro represents not just a technical upgrade but a geopolitical move to rebuild payment sovereignty and bolster economic security, positioning it to reshape Europe’s payment infrastructure and financial leadership.

🔮The IMF warns in its latest report that dollar stablecoins could weaken capital controls in high-inflation emerging markets, fueling currency substitution and cross-border outflows. Analysts counter that stablecoins remain far smaller than global FX and capital flows and are still used mainly for crypto trading, making them insufficient to drive macro-level capital flight. Since 2022, cross-border stablecoin flows have surpassed those of uncollateralized crypto assets; APAC leads in absolute volume, while Africa, the Middle East, and Latin America show higher exposure relative to GDP, reflecting structural demand for dollar-linked assets. The debate highlights stablecoins’ dual role: a potential “shadow dollar channel” for emerging markets, yet not large enough today to pose systemic risk. As adoption grows, regulating cross-border stablecoin flows will become a central battleground for policymakers worldwide.