What happens when money becomes technology?

Stripe’s new stablecoin products and the startup opportunities they create

Today I’m trying something new—paid subscribers get my spiciest, freshest thoughts on a recent development. Reply to this email to let me know what you think.

Technology’s magic is that it makes things cheaper and/or easier. In special cases, it lets us do things that were previously impossible. Aaand that’s kinda all there is to it. I recognize that is a little trite. Trying to describe the majesty of human invention with cost curves is a bit like saying the best way to understand how great a cheeseburger tastes is to lick the receipt.

However, this framing is helpful because whenever a tech company launches a new product, you can decide how important it is on the basis of how much cheaper it makes things or by what new activities it makes possible..

This is why I was so excited by several product announcements from Stripe’s developer conference this week around stablecoins. Its implementation of technology makes transactions materially cheaper and builds the scaffolding for new types of companies to exist. It is one of those rare moments where both benefits of technology happen at the same time.

The two key products:

• Financial accounts that allow businesses to hold balances and accept payments in stablecoins. These are available in 101 countries. Crucially, the balances in these accounts can be spent globally via a Visa card, instantly converting stablecoins at 150 million merchant locations.

• By letting any merchant hold stablecoin dollars directly, settle vendors in local currency, and avoid correspondent banks, Stripe can dramatically reduce the cost of a transaction.

For example, look at how this would play out just for the cost of changing currencies in an international transaction (known as FX fees).

Traditional way (what most companies still do): A customer abroad wires you $10,000. Your bank credits the dollars, then auto-converts them into your home currency (say euros) at the retail FX spread—roughly 2%. Later you have to pay a US supplier, so you convert some euros back to dollars, eating another spread. You end up losing 2% in each direction, or roughly $300-$400 on that $10,000, plus another $20-$40 in wire fees.

Stripe with stablecoins: Instead of wiring funds, your customer settles the $10,000 in USDC (or another supported stablecoin) through Stripe’s “Pay with crypto” flow. The payment lands in your Stripe balance as USD and incurs a 1.5 % processing fee—about $150—while skipping the first retail-bank FX hit entirely. If you can keep spending in dollars (for U.S. vendors, cloud bills, etc.), that’s the full cost. When you eventually need local cash, you invoke Stripe’s FX desk, which for most merchants runs roughly 2% on major corridors for another $200 or so. Net outlay: $150 if you stay in dollars, or about $350 if you convert once later.

Suddenly, the cost curve has shifted dramatically down. Over time as stablecoins are the norm, I imagine some of these intermediary steps will disappear entirely. To make the market even more prepared for stablecoins, many small transactions usually have flat fees, plus a percentage fee, so if you try to sell things for low prices online, you end up losing large parts of your margin.

Consumers benefit too—increased margin makes room to drive down prices. And for users in economies with currency subject to wild valuation fluctuations, being able to access digital dollars is enormously valuable.

Because Stripe is taking on all of the compliance complexity, there is an opportunity for founders to build newly profitable companies and startups have a chance to go international faster than ever before. Tens of billions of dollars are on the table, just waiting for entrepreneurs to grab them.

Startup opportunities I’m excited about