Key takeout
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Stablecoins are changing the payment landscape by speeding up transactions, lowering costs for cross-border payments, and allowing for programmable rewards, which is way ahead of traditional credit cards.
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Merchants in the U.S. collectively spend over $100 billion on card fees annually. In contrast, Stablecoins provide quicker and far cheaper payment solutions.
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With Ripple’s RLUSD, Gemini’s XRP cards, and Moca’s Air Shop Show, Stablecoins are set for a bigger presence in everyday commerce.
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As significant players look into adopting new solutions, Stubcoin could emerge as a pivotal player in the U.S. payment landscape.
Since their inception in 2014, Stablecoins have aimed to bring price stability to the often volatile cryptocurrency market. They’ve shifted how we view traditional banking by separating the preservation and transfer of funds, allowing FinTech companies to build programmable services into the global digital currency framework.
While businesses used to rely solely on card payments, the essential functions of holding deposits and other services were usually confined to banks.
Now, Stablecoins are gradually taking over many of these functions, predominantly operating on distributed networks as opposed to centralized platforms. They offer a flexible system of rewards, which cuts down on cross-border transfer times, lowers fees, and stabilizes financial values, surpassing credit card capabilities.
In the U.S., when a credit card is used, banks and payment networks often take a cut of around 1.5%-3.5% from each transaction, which can dent merchant profits and inflate prices for consumers. Thankfully, Stablecoins are beginning to shift this dynamic.
This article will delve into credit card costs, how Stablecoins stack up, their applications in the industry, and the implications for the credit card sector.
Costs Associated with Credit Cards
Credit cards are a go-to payment method, not just in the U.S. but globally. But this convenience doesn’t come cheap. Every transaction has hidden costs, including exchange rates charged by banks, network fees from companies like Visa and MasterCard, and other processing charges. These costs typically hover between 1.5% and 3.5%, directly impacting merchant profits.
Many companies, like airlines, retailers, and small businesses, often raise prices to make up for these charges, which ultimately puts a strain on consumers. The payment system favors card networks, leaving merchants with little control. Meanwhile, consumers pay the price indirectly through these inflated costs.
Stablecoins, pegged to fiat currencies like the U.S. dollar, offer quicker, more affordable, and clearer transaction options. By bypassing traditional card networks and their fees, they help businesses save money and pass on better deals to consumers.
Did you know? Unlike fixed cashback schemes, Stablecoins facilitate customizable loyalty programs. Merchants can design tailored inter-brand rewards and provide customers with greater value.
What are Stablecoins?
Stablecoins represent a type of cryptocurrency that aims to maintain a stable value, often linked to assets like the U.S. dollar. Unlike cryptocurrencies such as Bitcoin (BTC) or Ether (ETH) that are more volatile, Stablecoins present a stable option for daily transactions.
Their value is typically backed by cash reserves, short-term U.S. Treasury securities, or similar assets, usually aiming to maintain a value of around $1. They blend the quickness and efficiency of blockchain technology with the steady reliability of traditional currencies.
USDC, issued by Circle, is a Stablecoin that operates under U.S. regulations and receives regular audits. In December 2024, Ripple launched Ripple USD (RLUSD), which got regulatory approval from New York’s financial authority before hitting global exchanges. These U.S.-dollar-related Stablecoins are reshaping payment systems, presenting both businesses and consumers with a cost-effective and speedy alternative to traditional payment methods.
Stablecoins vs. Credit Cards: A Better Payment System
Stablecoins offer an alternative to credit cards by tackling two major pain points in U.S. payments: high fees and slow transaction times.
Although credit card payments seem instant, merchants often wait 1-3 business days to see those funds, all the while incurring transaction fees of 1.5%-3.5%, which diminishes their profits and are frequently passed on to consumers. On the other hand, Stablecoins can settle transactions within seconds to minutes, promising faster and more cost-effective options for both merchants and consumers.
It’s no surprise that merchants, airlines, and major retailers are keen to reduce their reliance on the Visa and MasterCard payment networks. By embracing Stablecoins, they can reclaim lost revenue, protect slim margins, and enhance their loyalty offerings.
The initiative currently leverages a blockchain-driven platform to promote Stablecoin-based rewards. This maintains real-world value while providing tangible economic advantages to businesses, making loyalty programs more attractive for customers.
Customers can genuinely claim ownership of their reward points, giving them the freedom to save or transfer points and use them beyond the originating platform.
Stubcoin Use Cases in the Credit Card Industry
The competition between Stablecoins and credit cards goes beyond just lower fees or faster transactions. It also highlights how large firms are evolving their payment systems to better serve customers.
From cryptocurrency-backed credit cards to Stubcoinbase’s loyalty models, the industry is embracing innovative hybrid approaches that blend traditional payment methods with the new.
Here are two case studies to illustrate how companies are enhancing their payment systems.
Gemini and Ripple’s Strategic Moves
On August 25, 2025, Gemini launched an XRP credit card in partnership with Ripple, offering up to 4% cashback (in XRP) on fuel, EV charging, and rideshare payments, with other categories receiving 3% or 2%. Rewards are credited instantly in cryptocurrency, and the card has no annual or foreign transaction fees.
Gemini also integrated Ripple USD (RLUSD) as the primary currency for all U.S. spot trading pairs, streamlining currency conversions. To support RLUSD further, Ripple bought Rail, a payment platform, investing $200 million to enhance cross-border payments, virtual accounts, and automation features.
Did you know? In Q2 2025, credit card interest rates in the U.S. averaged 21.16%, with higher rates for accounts carrying balances.
Retail and E-commerce Innovations
The AirShop, set to launch in September 2025, plans to reimagine its loyalty program using Stablecoin-powered transactions. The platform employs secure identity verification and layered membership options to provide tailored rewards. Central to this initiative are stable points (Air SP), USD support tokens linked to Stablecoins, preserving value unlike typical loyalty points. These stable points can be redeemed at over 2 million merchants via Bookit.com across various sectors like travel, retail, and dining.
Unlike conventional loyalty programs with restrictive use, Air Shop focuses on flexibility, allowing users to carry rewards seamlessly between brands. This benefits merchants by providing transparent and efficient ways to engage with customers, while consumers get trust and true economic value.
A $100 Billion Possibility: How Stablecoins Disrupt the Credit Card Industry
In 2024, credit cards topped the list of U.S. consumers’ payment methods, making up 35% of all transactions, with total purchases hitting $5.51 trillion and surpassing 56.2 billion transactions processed through Visa and MasterCard.
Stablecoins are challenging this costly system through blockchain technology, allowing for almost fee-free transactions and instant settlements. Should Stablecoins capture even 10% to 15% of the market, they could lead to substantial savings for both merchants and consumers.
The growing use of stubcoin-based payments and loyalty programs by retailers and airlines could pressure traditional credit card networks. Such a transition not only reshapes the payment landscape but could also lead to broader blockchain adoption, pushing Stablecoins from a niche solution to a central part of the U.S. financial system.
Did you know? Gemini’s XRP credit card was introduced in 2025, blending the ease of credit cards with crypto rewards, showcasing a mix of old and new financial systems.
Stablecoins as a Core Financial Element
The rivalry between Stablecoins and credit cards extends beyond mere transaction methods; it also signifies who holds power over monetary flows in this digital age. With better regulatory clarity, more institutional backing, and heightened consumer trust, Stablecoins are shaping up to be a faster, cheaper, and more programmable payment option.
With initiatives like Ripple’s RLUSD and Gemini’s offerings, cryptocurrency is sliding into mainstream finance. Likewise, giants like Amazon and Walmart are exploring their own Stablecoins to minimize fees and overhaul loyalty schemes. If successful, these initiatives could radically alter payment economics and shift billions of dollars in costs and profits across various industries.
Although credit cards remain a staple, blockchain-driven Stablecoins might soon be a fundamental component of U.S. commerce, redefining incentives, lowering costs, and reshaping customer interactions in a $100 billion payment ecosystem.
