Stablecoin Sandwich Is Dead: Crypto Payments Pivot to Users

The stablecoin sandwich — the fiat-to-crypto-to-fiat conversion loop that once defined crypto payments — is rapidly fading into irrelevance. According to Christian Catalini, co-creator of Facebook's Libra project and current MIT professor, the real battleground in stablecoin payments has shifted decisively toward distribution and user relationships. With Meta preparing to reintroduce stablecoin-based payment features across its 3.6 billion-user platform ecosystem in the second half of 2026, and Stripe doubling down after its $1.1 billion Bridge acquisition, the race is no longer about who issues the token but who controls the consumer touch point.

Stablecoin Issuance Becomes a Commodity

Stablecoin issuance is commoditizing rapidly, with new tokens launching across multiple currencies and jurisdictions on a weekly basis. This week alone, AllUnity — a German joint venture between DWS, Galaxy, and Flow Trader — debuted a Swiss franc-pegged token called CHFAU, while SBI Holdings and Startale Group introduced a yen-denominated stablecoin dubbed JPYSC. Earlier this month, Agant announced plans for a British pound stablecoin, and Hong Kong confirmed it intends to begin issuing stablecoin licenses in March.

The sheer volume of new entrants underscores what Catalini described as an inevitable commoditization of both the assets and the orchestration layer — the infrastructure that coordinates payments across blockchains and handles conversion between tokens and fiat. Once considered high-value businesses, these functions are becoming standardized utilities, according to Catalini.

Not just Meta, but also Google, Apple, all of them will be using multiple providers, as is the case when they do disbursements of payments. So I would expect the market to be commodified in the future, rather than a branded stablecoin. In a sense, it's a sign that the market has matured.

— Christian Catalini, MIT Professor and Co-Creator of Libra

Why Is Distribution the Real Moat in Stablecoin Payments?

Distribution — not token issuance or blockchain orchestration — represents the true competitive moat in the evolving stablecoin payments landscape, according to Catalini. The entity that owns the direct relationship with the end user will capture the greatest share of value as stablecoin rails become interchangeable. This marks a fundamental departure from the stablecoin sandwich era, where value accrued to those facilitating the fiat-to-crypto conversion.

Meta's return to stablecoin payments illustrates this shift perfectly. The company's earlier attempt with Libra, later renamed Diem in 2019, collapsed under regulatory and legislative pressure. But Meta's 2026 approach bears little resemblance to that failed initiative, according to Catalini. Instead of launching a branded token, Meta plans to integrate stablecoins from multiple providers as seamless payment infrastructure across Facebook, WhatsApp, and Instagram.

Andy Stone, Meta's VP of communications, reinforced this framing, stating that the initiative is simply about enabling people and businesses to make payments on Meta's platforms using their preferred method. The emphasis falls squarely on user convenience rather than proprietary token promotion.

Card Networks and the Defense of Interchange Fees

Traditional payment incumbents including Visa, Mastercard, fintechs, neobanks, and wallet providers hold a structural advantage in this new paradigm because they already own the touch point with the end user, Catalini noted. While stablecoin payments threaten the lucrative interchange fees that card networks currently collect, their existing distribution relationships with hundreds of millions of merchants and consumers provide a powerful defensive position.

If the card networks can commoditize both the rails and the underlying assets, they will be able to defend their business model, Catalini argued. He emphasized that the commoditization of stablecoin assets is inevitable — many banks will eventually want to issue their own — so the competitive intensity will concentrate on who controls the payment rails and distribution channels.

Stripe's Aggressive Play and the Neutrality Challenge

Stripe has positioned itself as a formidable contender in the stablecoin distribution race. The payments giant acquired stablecoin specialist Bridge for $1.1 billion last year and subsequently developed its own blockchain called Tempo. Stripe CEO Patrick Collison, who joined Meta's board of directors a year ago, represents a natural bridge between the two companies. Stripe is widely seen as a potential vendor Meta might tap for its stablecoin payment integration.

However, Catalini questioned whether rival payment service providers would build on a competitor's proprietary chain, even if Tempo is marketed as a public network. He pointed out that the fundamental promise of cryptocurrency is open, neutral infrastructure — a principle difficult to uphold when a corporate competitor controls the chain.

Catalini suggested that established blockchains like Ethereum, Bitcoin, or Solana offer far more credible neutrality than corporate-backed alternatives. The challenge, he acknowledged, is delivering on that openness from a practical perspective — but building on an already established and neutral chain remains the strongest alignment with crypto's founding ethos.

What This Means Going Forward

The stablecoin payments industry is entering a phase where issuance and orchestration no longer differentiate competitors. Distribution and user relationships will determine winners. Companies with massive existing audiences — Meta with 3.6 billion users, card networks with global merchant acceptance, and Stripe with its vast developer and merchant base — hold the strongest positions as stablecoin infrastructure becomes commoditized.

Recent reports of companies walking away from acquiring stablecoin orchestration firms further validate this trend. The value proposition in stablecoin payments has migrated up the stack from token plumbing to platform reach. For incumbents willing to embrace stablecoin rails as a commodity input, the shift could prove more opportunity than threat.