With the booming development of digital currencies, stablecoins, as a cryptocurrency with the goal of stabilizing prices, have gradually come into people's view. Is the main user scenario of stablecoins payment or transaction? This question has triggered widespread discussion and thinking. Let's explore in depth and unveil the mystery of stablecoins.

Stablecoins play an important role in today's digital economy. It was originally designed to solve the problem of large price fluctuations of traditional cryptocurrencies, making them more suitable for daily payments and transactions. In actual use, stablecoins can be used as both a payment tool and a transaction medium, and the balance between the two needs to be carefully grasped.

Payment is a major user scenario for stablecoins. As people's acceptance of digital payment methods continues to increase, stablecoins are favored as a safe and convenient payment method. For example, Alice bought a watch she had long admired online, and she chose to pay with stablecoins. Because the price of stablecoins is stable, Alice does not need to worry about exchange rate fluctuations when paying, and enjoys convenience and peace of mind.

In addition to payment and trading, stablecoins also show great potential in cross-border payment, lending and other fields. With the vigorous development of the global digital economy, stablecoins are expected to become a link connecting global business and promote the convenience and efficiency of cross-border trade. At the same time, the smart contract function of stablecoins has also brought innovation to the lending market, providing more choices and guarantees for borrowers and lenders.

In general, stablecoins are both a powerful assistant for payment and a reliable partner for transactions. Its value is not only reflected in technological innovation, but also in the convenience and security it brings to users. In the future digital economy era, stablecoins will surely play an increasingly important role and become a dark horse in the field of digital finance.

Is the main user scenario of stablecoins payment or transaction? There is no absolute answer to this question, but it depends on user needs and scenario selection. Whether as a payment tool or a transaction medium, stablecoins will show their unique value and charm in the digital economy. Let us wait and see and witness the development and growth of stablecoins in the future!

The four most famous international exchanges:

Binance INTL	OKX INTL	Gate.io INTL	Huobi INTL
China Line　APP DL	China Line　APP DL	China Line　APP DL	China Line　APP DL

Note: The above exchange logo is the official website registration link, and the text is the APP download link.

The possibility of buying pizza with a stablecoin is a gateway to mainstream adoption for cryptocurrencies. Some stablecoin issuers, such as Coinbase, Paxos, and Terra, are working in this direction and have achieved some early success.

Coinbase Commerce, the payments arm of Coinbase, encourages shoppers to pay with USDC, which is issued by a consortium that includes Coinbase. Paxos allows its debit card users to spend PAX on everyday purchases. Across the Pacific, South Korean startup Terra has attracted 240,000 online shoppers in 40 days, and its users can use its tokens to pay for everything from coffee to clothes to baby wipes.

In fact, the effort represents a change in the cryptocurrency market. Stablecoins grew out of trading cryptocurrencies, allowing traders to quickly get in and out of trading positions, and now they are entering the world of e-commerce and merchant payments.

“If you think of trading as one of the few early use cases, then using it as a medium of payment is one of the later use cases,” said Juntin O’Brien, head of Coinbase Commerce.

Buying Pizza with USDC? Not So Soon

Stablecoin payments promoted by Coinbase Commerce and Paxos are still in the early stages of implementation. Previously, Coinbase Commerce only accepted BTC, ETH, BCH, and LTC, and only added the USDC stablecoin a month ago. This means that merchants can now accept their customers' stablecoins through Coinbase Commerce.

Meanwhile, Paxos recently reached partnerships with debit card issuers Spend.com and crypto.com, which allows users who hold PAX in crypto wallets to use it for daily shopping payments. Paxos CEO
Charles Cascarilla also explained why using stablecoins will eliminate the settlement risk of merchants under the current payment system.

In the traditional model, when consumers pay with credit cards, merchants do not receive payment immediately. They usually have to wait for several days for the payment to be credited. However, Cascarilla said: "When consumers pay with PAX, merchants can receive the money immediately, and the money is already in the merchant's hands, and the merchant can use it to buy other things immediately. This is not some kind of IOU, which does not take a day or two to arrive."

In many ways, Terra is already ahead as a payment medium used by consumers. According to Terra CEO Daniel
Shin, unlike other stablecoin issuers, Terra’s goal is not to attract cryptocurrency enthusiasts. Instead, Shin said, the company uses stablecoins primarily to process payments, which can continue to reduce merchant costs and provide customers with ongoing discounts.

“I think from a sales perspective, telling users that it is built on blockchain is a disadvantage because it is a new technology and everyone is afraid of new technology,”
Shin said. “Only by saying that we save users money and give them discounts can we attract them to join.”

The company proposes to reduce transaction fees for merchants by 90%. For example, on Korean e-commerce site TMON, if users choose to use credit cards as a payment method, TMON needs to pay an average of 2.1% for each transaction. Shin said that with Terra, this fee is halved, and the company hopes to continue to reduce this fee.

The startup reported that it had processed more than 380,000 transactions on two Korean e-commerce sites within 40 days of supporting stablecoin transactions.

Path to mass adoption

Even so, cryptocurrencies still face obstacles. After all, for many people, it’s confusing to exchange fiat for stablecoins and then use them to pay for purchases. So for now, Paxos is focused on serving cryptocurrency holders by allowing them to pay with stablecoins, not just trade.

“If the first use case for cryptocurrency is trading… then stablecoins, as we’ve seen with PAX, also give these users real-world functionality, where they can spend it if they choose,” Paxos’ Simpson said.

In contrast, Coinbase
Commerce wants more people to hold USDC first before expanding its payment goals. “Current stablecoin adoption is largely limited to trader users… Some key features need to be implemented to incentivize people outside the trading community to hold USDC or other stablecoins.”

However, stablecoins are not limited to payment scenarios, they also play an important role in transactions. Traditional cryptocurrencies such as Bitcoin have large price fluctuations and are not suitable as a transaction medium, while the price stability of stablecoins makes them an ideal choice in transactions. For example, Bob is a digital currency investor who uses stablecoins to trade digital assets on the exchange. Since the price of stablecoins is relatively stable, Bob can better control risks and achieve a steady increase in transaction value.