08-11-2025 
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In ‘From PayPal to Protocol: Why digital dollars still fall short,’ I discussed how stablecoins are the next iteration of the USD.
However, stablecoins are more than just tokenized fiat currencies; they can be akin to programmable economic permission slips.
In this piece, we’ll explore what that means and how it will change the Internet.
The promise BTC couldn’t keep
When Satoshi Nakamoto released the Bitcoin white paper in 2008, he explained how Bitcoin solved the double-spend problem and made small, casual payments possible without trusted intermediaries.
Suddenly, the dream of a purely peer-to-peer Internet economy built on sound money appeared possible again. While Satoshi faced plenty of skeptics, Bitcoin proved them wrong, and Satoshi made it clear it had no theoretical scaling ceiling.
However, BTC failed to deliver on Satoshi’s original promise. After small blockers seized control of the software repository and narrative, they implemented irreversible software changes and promoted a culture based on HODLing rather than doing commerce. Bitcoin became digital gold rather than electronic cash, and the dream of peer-to-peer transactions took a back seat to speculation and trading.
However, the dream of electronic cash didn’t die with BTC. Stablecoins came along in 2015, first with BitUSD and then with Tether. DAI, USDC, and several others followed.
Suddenly, the idea of Internet-native payments was back on the table. This time, they’d be based on a stable token backed by currencies people trusted, at least in most cases.
Use cases beyond simple payments
Stablecoins can be part of a new Internet stack with use cases far beyond straightforward payments.
When they work on a scalable ledger, they’ll have huge impacts on creator economies, access to computer networks, how communication apps work and interact, and can even increase accessibility to the USD in the real world.
In creator economies, stablecoins can be used to unlock paywalls. Imagine paying $0.20 to read an article in the New York Times instead of subscribing. They can ensure that royalties are paid in real-time, enable more equitable splits between artists and collaborators, and allow fans and patrons to tip creators in a stable currency they both trust.
The ability to make micropayments with stablecoins has all sorts of use cases for knowledge acquisition and learning. Teachers can gamify learning by setting up rewards, incentivized Q&A forums mean better Quora/Reddit threads are possible, and interactive courses could have pay-per-segment interfaces.
Stablecoins can also act as access tokens. Servers could require deposits or payments to access their systems and retrieve content. Application Programming Interfaces (APIs) could charge per data packet. Virtual Private Networks (VPNs) and other Software as a Service (SaaS) apps could charge based on usage rather than relying on subscription models which limit their user bases.
Stablecoins will likely have profound impacts on digital communication, too. Imagine it costs $0.10 to message or email someone unless you’re on their approved contacts list, and think about what that would mean for spam.Executives will be able to set rates on their email inboxes and prioritize messages according to who paid the most for their attention. Money will be sent anywhere, anytime, via WhatsApp, Telegram, and other messaging apps with near-zero fees.
Stablecoins, particularly micro and nanotransactions denominated in them, will impact gaming, financial services, cybersecurity, and just about every other industry. It’s difficult to imagine a facet of the Internet that they won’t touch and transform in some way.
When combined with smart contracts, the utility of stablecoins takes on completely new dimensions. Combining these means contracts can be settled automatically based on information retrieved from data oracles, funds can be released when conditions are met, and refunds can be issued automatically when items are returned, to give just a few examples.
However, there’s a problem standing between the dream of a better Internet and reality—the current popular blockchains don’t scale.
Stablecoins require a scalable base layer
In the ‘Stablecoin Tower of Babel,’ I wrote about the state of the stablecoin ecosystem today. In short, it’s not good; everything is fragmented across dozens of unscalable blockchains, impacting liquidity, the user experience, and more.
There’s no point in having stablecoins on dozens of different ledgers; it’s akin to having email on dozens of different protocols. Imagine our emails used different protocols and relied on bridges and extra code to translate between them. That may sound ridiculous, but it’s how value transfer between blockchains occurs today.
It’s best to think of stablecoins as the value layer and blockchains as the base layer. Before the next Internet economy can become a reality, we need a scalable base layer all stablecoins can ride on top of. To maximize utility, it needs to have tiny fees, massive throughput, and smart contracts.
Yet, even that is not enough. As regulators crack down and banks and financial institutions issue their digital dollars, the base layer will have to be legally compliant. As stablecoins become part of the real-world economy, the rails they run on will have to allow for Know Your Customer (KYC) and anti-money laundering (AML) compliance, freezing the proceeds of crime, and sanctions.
Make no mistake about it—with the passage of the GENIUS Act into law, stablecoin issuers are now subject to the Bank Secrecy Act in the United States, so compliance is non-negotiable.
As time goes on, younger generations won’t even think of stablecoins as such—they’ll simply be native Internet money, something that has always existed.
When that happens, those of us who called PayPal (NASDAQ: PYPL) to unfreeze our funds, paid 5% remittance fees, and had our credit card details leaked in data breaches will wish stablecoins had existed earlier.
Watch: New age of payment solutions
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