Author: Prathik Desai, Compiled: Block unicorn

Foreword

Every time stablecoins become a hot topic, I see someone claiming that "stablecoins will replace Visa and Mastercard." Crypto Twitter and other media are talking about the traditional financial system being replaced by a new one. Many people agree with this statement, but I think it is naive and childish, and at best it is just a good wish.

This week I read Artemis’ latest report on stablecoins and card payments. The report further confirms that the expansion of stablecoins is based on existing infrastructure established by traditional financial cards such as Visa and Mastercard, rather than being built around them.

The report illustrates how stablecoin payments can rapidly scale by leveraging distribution and consumer credit, two areas where cryptocurrencies themselves do not have a competitive advantage.

It is clear from the report that crypto cards are bridging the gap between stablecoin balances and daily transactions. However, there is another, more important story here.

In today's analysis, I'll dive into why bank cards, and credit cards in particular, offer the greatest opportunity to drive this shift to scale.

Rewards + card swiping = scale

Retail Stablecoin payments grew from $1.7 billion in January 2023 to $3.5 billion in August 2025. However, this growth does not stem from merchants accepting stablecoin payments at checkout. About 75% of the growth is coming from leveraging existing consumer behavior – specifically card payments.

Cryptocurrency card payment volume grew to over $1.5 billion in August 2025, five times higher than in August 2023 ($280 million). Average monthly transaction volume soared from $250 million in early 2023 to over $1 billion in 2025. During the same period, P2P stablecoin payment volume remained stable, with an average monthly transaction volume of US$1.5 billion.

The growth of card payments may seem surprising, but its scale is driven by two of the most popular card benefits for users: tap-and-pay convenience and rewards.

P2P Stablecoin transfer volume has stagnated because it is mainly driven by demand. People use stablecoins to overcome funding constraints, banking disruptions, and remittance barriers. Once these urgent needs are met, there is very limited room for growth in this type of transfer method. This is because making such transfers still requires users to understand how stablecoins and crypto wallets work.

But bank cards can transfer all consumption activities, including buying toys, TV sets and paying subscription fees, to stablecoin channels. This does not require people to understand stablecoins. They can make contactless payments via stablecoins just like they would with fiat currencies.

Distribution trumps brand

Artemis 's report also shows that brands are far less important than the infrastructure they integrate with. The report states that Visa and Mastercard each support more than 130 cryptocurrency card projects, but Visa accounts for more than 90% of on-chain card transaction volume.

This is because transaction volume will follow the networks that are most integrated with the infrastructure middle layer (including issuers, processors, project managers and compliance-heavy operations teams) that make the user's card swiping experience frictionless.

In this case Visa established partnerships with middle tiers early on, while Mastercard initially focused more on working with exchanges. Partnerships with major card issuers can spawn dozens of credit card programs and open up a pipeline of new products.

Through Visa and Mastercard, stablecoins can be adopted by millions of users.

Once the transfer and conversion network between stablecoins and fiat currencies is established, users and merchants will encounter minimal friction when paying with bank cards and accepting stablecoins.

ButWhy do people suddenly change their payment methods to use stablecoins one day? They probably won't. So, how to solve this problem?

Reward Moat

This is where credit cards come into play through inherent features like subsidies and rewards.

When you make it financially irresistible for merchants and users to switch to stablecoin payments, they will be truly ready to make the switch.

Think cash back, bonus points, VIP lounge access, interest-free installments, surcharge waivers and other small perks. Combined, these make it easier to develop new spending habits.

While this is ultimately a negative for card issuers, they do not view credit cards as a single line of business.

Crypto Currency card issuers have always followed established customer acquisition strategies. Gemini, EtherFi, Coinbase One, and other cryptocurrency cards do much more than just payments. Through the reward mechanism they provide, they build a user acquisition channel to attract new trading users and retain some of them as active users. The issuer then cross-sells other services such as loans, trading, subscriptions and income products.

But I think there is greater potential here to further improve user stickiness.

Credit Opportunities

Most current cryptocurrency cards still require users to hold stablecoins or fiat currencies on the card before spending, just like a debit card. Pre-charging means friction. This requires users to either hold a new type of currency, a stablecoin, or merchants to access stablecoin infrastructure. Getting people to change the way they hold, spend or receive money on a daily basis is a huge challenge.

But, what if transactions are not conducted with stablecoins, but settled through fiat currency infrastructure? Users can deposit their cryptocurrency holdings into a yield-based vault, earn interest, and use these funds as collateral to obtain fiat loans. It's like using a credit card at checkout - spend first, pay later. The credit limit here is not set by the bank, but is secured by the cryptocurrency held in the vault and is expressed as a loan-to-value ratio (LTV). If the value of the collateral drops, the amount you can borrow may be reduced. The remaining transactions will be settled like other fiat transactions between users and merchants. Spend first, settle later.

This credit wrapping (the third option in the picture above) brings the convenience of credit back to the consumption process without requiring users or merchants to hold stablecoins. It adapts to consumer behavior patterns without changing their consumption habits.

Let me demonstrate this through the personal experience of a friend of mine.

He joined late when India launched Unified Payments Interface (UPI) to digitize mobile payments. There is no doubt that it works very well. But it didn’t suit his habits as a credit card enthusiast. Of course, he still uses it occasionally because it's convenient and quick, or when he doesn't have his wallet. But that changed in 2022, when it started supporting his RuPay credit card payments. Once he can tie his credit card to any payment app like Google Pay or PhonePe, the ease of use of UPI is perfectly combined with the convenience of credit card payments. Even without swiping the card, he can use his credit limit and accumulate reward points.

The data reflects the impact.

As of November 2025, RuPay accounted for 38% of total credit card transactions in India and 8% of transaction value, up from 10% and 1.8% respectively a year ago. RuPay's credit card transaction volume via UPI almost doubled to $7.4 billion between April and October 2024, compared to $3.89 billion between April 2023 and March 2024.

Artemis's report shows that the growth of stablecoins no longer depends solely on the stablecoins themselves, but more on how they are packaged and distributed. The report lists data on distribution partnerships, incentive budgets and credit mechanisms. But what excites me most is the emergence of credit-led products that completely remove the entire cryptocurrency settlement process from the user experience.

Stablecoins are likely to become an invisible part of the infrastructure, while familiar processes such as underwriting, risk control and rewards will become user-facing products.

During this process it is expected that Visa and Mastercard will continue to operate normally and support the entire payment infrastructure to seamlessly move funds - whether in cryptocurrency or other forms of funds.