Why Payments Is Not Just a Use Case
Last week wasn't about RWAs.
Last week was huge.
So this is a short, sweet and bullish post.
Just two points to make:
Despite appearances, last week was about payments, not RWAs.
Payments matter, a lot.
LAST WEEK WAS ABOUT PAYMENTS
Yes, I'm aware that Superstate now allows companies to issue securities onchain (legally) and it’s cool.
And I'm also aware that the initial use case for stablecoins wasn't payments, from Arthur Hayes:
But last week was still about payments.
Let’s go over it.
Stripe/Bridge now allows companies to transact in stablecoins globally.
Meta is considering making creator payouts in stablecoins.
Ramp now allows people to use card terminals with Ramp stablecoin cards.
x402 is Coinbase’s new standard for payments via web APIs, intended to be embraced by AI agents and their tools.
If May 1st is included, even the World x Tinder announcement and the Aztec Public Testnet are bullish for payments…
Bitcoin’s original use case is finally moving.
(Although regulated, KYC'd stablecoin payments apps is probably not what Satoshi had in mind.)
And here’s why that is really important.
PAYMENTS HAS GIVEN CRYPTO A COMPOUND ANNUAL GROWTH RATE
Take a look at these 2 charts from last week:
It’s this last point on stable PMF that is so important.
Until now, crypto hasn't had a Compound Annual Growth Rate (CAGR).
That’s pretty rare for an industry.
This may be ex-management consultant bias but every industry has a CAGR!
Whereas in crypto, most metrics are tied to the bull/bear cycle.
Activity was conditional on issuance of tokens linked to speculating on crypto’s future success.
In short:
Positive forward-sentiment → Market cap → TVL → Revenue
Having even a subset of the industry with a stable CAGR is transformational.
Notice how few Series A+ funds are there in crypto? Part of this is that the early token liquidity model makes a better fund return profile, but also it’s really hard for a crypto company to control their growth rates to succeed at raising successive financing. Compare this to SaaS apps that have almost programmatic benchmarks of what they need to raise at Series A-D.
But a steadily growing global stablecoin payments economy can become a reliable market for crypto startups to support and grow together with.
It prevents talent from bleeding back into AI every 2-3 years.
And it creates demand for capital allocation opportunities which in turn grows the rest of the industry:
Good times ahead.