Stablecoins, digital tokens pegged to sovereign currencies such as the US dollar, originated as instruments for moving funds between cryptocurrency exchanges. Their role has since shifted toward payment infrastructure, and recent moves by PayPal and American Express show how large payment companies are adopting the technology: not mainly as a consumer checkout feature, but as a settlement layer that moves money between institutions.
PayPal launched its dollar-pegged stablecoin, PYUSD, in August 2023. The token is issued by Paxos Trust Company, a regulated New York trust institution. Initially offered to US consumers for peer-to-peer transfers and purchases at merchants on PayPal's platform, PYUSD has since been deployed on additional blockchains, including Solana, and integrated with Xoom, PayPal's remittance service, for cross-border transfers. US business accounts can hold and transact in the token, and in late 2025 PayPal removed fees on PYUSD transfers for US users and extended stablecoin cross-border payment options to business customers. The stated rationale is cost and speed: stablecoin transfers settle in minutes and can bypass slower correspondent banking flows.
In November 2025, American Express announced plans for a stablecoin settlement network built with Solas, a startup founded by veterans of Meta's abandoned Diem stablecoin project. Founding participants include Banco Santander, Banco Bradesco, U.S. Bank, Wells Fargo, Citigroup and Emirates NBD, with a launch planned for 2026. The network is designed to let banks and merchants settle card transaction obligations in stablecoins instead of through conventional interbank transfers. American Express has also filed trademark applications for the name AE Coin in connection with a possible stablecoin, and press reports have indicated that issuance would take place on the Solana blockchain.
Conventional card settlement involves acquirers, issuers, card networks and, in cross-border cases, chains of correspondent banks, with funds often taking days to reach merchants and pausing over weekends. Stablecoins operate around the clock on public blockchains, typically settle within seconds or minutes, and, being dollar-denominated, reduce the number of conversion and reconciliation steps in international flows. Card networks had already tested the model: Visa has settled transaction fees with processors such as Worldpay and Nuvei in USDC over Ethereum and later Solana, and Stripe acquired the stablecoin infrastructure firm Bridge in a deal reported at roughly 1.1 billion dollars. Regulation has supported institutional adoption. The US GENIUS Act, signed in July 2025, established a federal framework for payment stablecoin issuers, and the EU's MiCA regime took full effect at the end of 2024. Consumer-facing services have grown in parallel, including apps such as Oobit, a Tether-backed platform that lets users spend stablecoins at Visa-accepting merchants directly from self-custody wallets.
Challenges remain. Stablecoins issued inside closed corporate ecosystems may circulate mainly within those ecosystems, and liquidity, redemption and compliance depend on banking relationships that differ by jurisdiction. Interoperability standards across blockchains are still maturing. The PayPal and American Express initiatives nonetheless point in a consistent direction: the payment industry's near-term use case for stablecoins is institutional settlement, with consumer spending built on top of existing card rails rather than in place of them.