Retail Banking Institute | Stripe's stunning stablecoins

Stripe's stunning stablecoins

Stripe published its annual letter last week and it's worth a read for anyone interested in the transition to the internet economy. The company processed $1.4 trillion in payments last year and says it had a profitable year on the back of investments in machine learning. "The US corporate sector is both a cradle of invention and a densely populated graveyard of companies that had fabulous futures in their pasts," write brothers John and Patrick Collison. "Of the 500 companies in the S&P 500 at its inception in 1957, only 53 remain in the index today. (More than half of that remaining 53 use Stripe.) Back in 1957, companies could expect to remain in the index for 61 years. In 1980, the average tenure was 36 years. Today, it's just under 20 years. Enduring businesses are increasingly rare." Stripe says 39 of the 50 companies in the Forbes AI 50 use its services. John Collison told MSNBC that some of the world's biggest companies including NVIDIA are now using the platform, and he had positive thoughts on stablecoins, which he sees as delivering a lot of real word utility. "Businesses we sell to are coming to Bridge (which Stripe acquired last year) for corporate treasuries, and for international remittances. The chains have gotten much more performant." And how are stablecoins being used? We know that the large volumes are mostly accounted for by cashing in and out of cryptos. But according to Stripe: "Some of our favorite examples: SpaceX uses Bridge to repatriate funds from Starlink sales in Argentina, Nigeria, and other markets. DolarApp, a neobank in Mexico, uses Bridge to help individuals receive USD payments from payroll providers like Deel. Airtm uses Bridge to disburse payments to workers all over Latin America. Why care about stablecoins? Improvements to the basic usability of money make economies more prosperous. Consider the transitions from coins to banknotes, from the gold standard to fiat currency, and from paper instruments to electronic payments. Stablecoins are a new branch of the money tree. Such transitions occur with some regularity over the centuries, and the effects tend to be large." If you want to understand why Stablecoins are the new Petrodollars or Eurodollars, read the letter here.