Payments giant Stripe returns to crypto space, supports USDC stablecoin payments on Ethereum, Solana and Polygon

A decade after its early attempts to support Bitcoin payments, the company envisions a future powered by stablecoins.

Payments processor Stripe has re-entered the cryptocurrency space after announcing today that it will soon allow merchants to receive funds in the USD Coin (USDC) stablecoin.

Starting this summer, the San Francisco-based company will allow companies using its technology to accept USD Coin (USDC) for online payments. USDC is the second largest stablecoin in the cryptocurrency space and the sixth largest cryptocurrency by market capitalization.

John Egan, Stripe’s head of crypto, said in a press release: “We’re excited to empower Stripe users to accept stablecoin payments, helping them expand their global reach and allowing our customers to do so simply and quickly even without a bank account or credit card. and a trustworthy transaction.”

A Stripe spokesperson confirmed to the outlet that USDC transactions will initially be supported on the Ethereum, Solana and Polygon networks, adding: “A final, more comprehensive list will be announced closer to launch.”

A Stripe spokesperson confirmed to the outlet that Stripe will initially support USDC transactions on the Ethereum, Solana and Polygon networks. It added that "a final, more comprehensive list will be announced prior to launch."

Back in 2014, Stripe became one of the first major companies to accept Bitcoin payments. However, by 2018, Stripe closed this payment option due to rising costs on the world’s largest blockchain, and its cryptocurrency-related plans were unsustainable.

Despite abandoning the service, the company said at the time that it remained "very optimistic about cryptocurrencies overall."

Stripe moved back into the cryptocurrency space in March 2022, promising fraud prevention features like know-your-customer (KYC) requirements by making its payments platform available for NFT purchases and other Web3 companies. Additionally, the company was also rumored to be working with Twitter on payment features last year. This shows that Stripe is expanding its services to accommodate growth in the cryptocurrency and Web3 space, while focusing on improving the security and compliance of transactions.

Stripe has announced that it will allow merchants to accept the USDC stablecoin for payments and settle transactions on-chain. Payments made using stablecoins are automatically converted to fiat currency and credited to merchants’ Stripe accounts, Stripe has announced. This suggests that Stripe is expanding its payment services to support cryptocurrencies, specifically the stablecoin USDC, which may provide merchants with faster and more flexible payment processing options. By automatically converting to fiat currency, Stripe also reduces the risk for merchants dealing directly with cryptocurrency volatility.

A stablecoin is a cryptocurrency whose value is pegged to another asset, such as the U.S. dollar or gold. They are designed to be less volatile than Bitcoin or other digital assets known for their price volatility. This feature allows stablecoins to act as a more stable medium of exchange in the cryptocurrency market, especially when market volatility is high, and they can be favored as a store of value or a means of transaction. The stability of stablecoins also makes them useful in cross-border transfers and smart contract applications.

These stablecoins and tokens are often used by cryptocurrency traders to quickly enter and exit trading positions in other coins or tokens without having to convert them directly into fiat currencies such as the U.S. dollar - especially when access to such currencies is restricted or prohibited in the case of. This feature of stablecoins provides traders with the flexibility to move funds between different cryptocurrencies while avoiding the additional costs and time delays that may be involved in traditional fiat currency conversions. In addition, stablecoins can also serve as hedging tools, helping traders protect the value of their assets in times of market instability.

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