Carl Grimstad, CEO at Lydian
The UK recorded 48.1 billion payment transactions last year, according to HM Treasury, equivalent to around 1,500 transactions every second. Unsurprisingly, most consumers and businesses rarely think about what happens behind the scenes when a payment is made. As stablecoins move into new payment use cases, the same principle applies: for businesses to use them in practice, the underlying infrastructure needs to make the experience simple, reliable and familiar.
For merchants, the experience needs to be simple. A customer chooses to pay with a digital currency, the transaction is approved, and the business receives the expected amount in its local currency.
Connecting to Existing Payment Infrastructure
A payment system needs to connect digital wallets with the systems businesses already use, including payment gateways, point-of-sale technology, banks, and established payment networks. Most merchants are unlikely to replace those systems simply to accept a new form of payment. Stablecoins therefore need to work alongside existing infrastructure rather than requiring businesses to rebuild their payments stack.
This matters in the UK, where payments are already highly digital, and consumers are accustomed to contactless payments, mobile banking and digital wallets. HM Treasury’s National Payments Vision identifies resilient infrastructure as a foundation for a trusted payments ecosystem and says future infrastructure needs to support innovation while remaining reliable.
What Happens After the Payment?
Settlement is another important part of the equation. Stablecoin transactions can move quickly, but the merchant still needs to know what happens after the customer has paid. If the business operates in a market where its costs, payroll, and suppliers are settled in local currency, it may not want to hold a digital asset on its balance sheet.
Converting the payment into local currency and getting that money into the merchant’s account is therefore just as important as accepting the payment in the first place. For a business, the value of a new payment method depends on what happens at the end of the transaction, not simply how quickly the initial payment moves.
The Cross-Border Challenge
This becomes particularly relevant for cross-border commerce. A customer may pay from one country while the merchant operates in another, creating additional questions around currency conversion, settlement, and how funds move between different payment systems.
Stablecoins can provide another way of moving value across borders, but the payment experience still depends on the infrastructure connecting the different parties. If the final settlement introduces delays, additional costs, or uncertainty around the currency received, some of the benefits of the original transaction can be lost.
Keeping the Merchant Experience Simple
There is also the issue around customer experience. People do not think about payment infrastructure when they tap a card or use a mobile wallet. They expect the payment to work; businesses have the same expectation.
Businesses need clear confirmation that a transaction has gone through, visibility over when funds will arrive, and certainty about the currency they will receive. The merchant should not need to understand how a wallet connects to a blockchain or how the underlying digital asset is converted. Those complexities can sit within the payment infrastructure to avoid confusion.
Building the Next Payment Rail
For stablecoins to become a practical payment rail, these behind-the-scenes connections matter. The technology has to fit into the way merchants, banks, payment providers and consumers already move money.
The UK’s payments ecosystem is already operating at an enormous scale. The next stage for stablecoins will be about whether the infrastructure around them can meet the same basic expectation as existing payment methods: that the payment works, the money arrives, and the business knows exactly what it has received.
That puts the focus firmly on the infrastructure connecting wallets, payment networks, and bank accounts, and on whether that infrastructure can make a new form of digital money feel as straightforward to use as the payment methods businesses already know.
