Circle's stock price doubles, a paradigm shift in stablecoins

Author: Chloe, ChainCatcher

In early 2026, the payments industry is playing an asymmetric betting game. From Circle launching the Arc blockchain and nanopayments, to Stripe partnering with Paradigm to incubate the payment public chain Tempo and investing $1.1 billion to acquire Bridge, the giants share a common goal: they are no longer designing payment tools for humans, but building entirely new financial tracks for AI agents.

This arms race revolves around the idea that once AI agents become the main actors in economic activity, traditional credit card fees of 2–3% will gradually become unnecessary, replaced by low-cost stablecoin payment protocols. In February this year, Citrini Research published a long scenario analysis predicting this future, causing Visa, Mastercard, and American Express to lose $5–7 billion in market value in a single day.

Is this an overreaction by the market, or a premature pricing of long-term value by capital? It’s still too early to tell. However, a huge gap remains between ideals and reality: when the x402 protocol’s monthly transaction volume is still around $24 million, the global e-commerce market has already reached a staggering $6.88 trillion. This raises questions: is this a groundbreaking strategic move, or a reckless gamble that overextends into the future?

The AI Payment Arms Race Has Begun, But the Battlefield Is Still Forming

In early March 2026, Circle CEO Jeremy Allaire revealed a detail: the company completed $68 million in internal settlements within 30 minutes using its USDC stablecoin across 8 of its business entities, all without traditional bank wire transfers. By traditional financial standards, similar cross-border transfers usually take 1–3 business days and involve high bank fees.

This successful demonstration sends a clear signal to the market: stablecoins as “modern financial infrastructure” are no longer to be ignored. They prove that companies can bypass traditional banking networks to achieve large-scale cross-border or internal fund transfers at low cost and high efficiency.

This is not an isolated case; it marks the beginning of the infrastructure that the crypto industry has been building for years.

Circle’s Dual Strategy: Focus on Micro-Payments and Agent Commerce

Circle’s approach clearly shows a dual-track strategy: first, Arc, a Layer 1 blockchain launched in October 2025 with a public testnet, using USDC as its native gas token. It offers sub-second finality and “USD-pegged” predictable fees, directly addressing the pain point of cost fluctuations caused by on-chain congestion in traditional EVM chains during payments.

Second, there’s Nanopayments, launched in early March this year, supporting USDC transfers as low as $0.000001 with zero gas fees. By batching on-chain settlements, Circle consolidates thousands of microtransactions into a single on-chain operation, reducing costs to nearly zero. The partnership with OpenMind is also impressive: a robot dog named Bits autonomously pays its electricity bill, symbolizing a proof of concept for “agent commerce,” demonstrating the possibility of robots as independent entities conducting transactions in the physical world.

Stripe’s Strategic Focus: Ecosystem Scale and Traditional Finance Integration

Stripe’s strategy also demonstrates ambition. In September 2025, Stripe partnered with crypto venture firm Paradigm to launch Tempo, a dedicated Layer 1 blockchain for payments, aiming for 100,000 transactions per second and sub-second finality. Tempo’s architecture shares similar design principles with Circle’s Arc, supporting stablecoin-based gas payments and built-in AMMs for cross-currency settlement.

Moreover, Tempo’s ecosystem includes top institutions like Visa, Mastercard, UBS, OpenAI, and Shopify. Considering Stripe’s previous acquisitions of Bridge ($1.1 billion), Privy, and investments in Tempo, its total investment in stablecoin infrastructure likely exceeds $1.5 billion.

How Citrini Research Could Trigger a Black Monday for Traditional Payment Giants

In late February 2026, an independent firm called Citrini Research published a lengthy scenario report titled “The 2028 Global Intelligence Crisis” on Substack.

The core narrative: as AI agents begin making shopping and payment decisions at scale, “eliminating transaction friction and costs” will become a key goal of algorithmic optimization. In Citrini’s scenario, by 2027, these agents will bypass traditional credit card networks and settle in stablecoins on Layer 2 solutions like Solana or Ethereum, where transaction costs are a fraction of those in traditional finance.

The report went viral among tech and finance circles over the weekend. By Monday, February 23, market sentiment sharply deteriorated. Visa’s stock fell over 4%, Mastercard dropped more than 6%, American Express nearly 8%, and several credit card and consumer finance firms saw market caps evaporate by hundreds of millions of dollars in a single trading day.

As the report was widely shared by tech and finance influencers on platforms like X, Citrini’s macro scenario memo, originally a “risk exercise,” was misinterpreted as a “pre-vision of the future,” amplifying fears about the relationship between AI, stablecoins, and traditional payment networks.

Why Stablecoins Are the “Native Currency” for AI Agents

To understand why stablecoin issuers like Circle and infrastructure providers like Stripe are betting on “agent-native payments” as their next strategic move, it’s crucial to see that once transaction actors shift from humans to AI agents, the foundational assumptions of traditional credit card networks start to weaken.

High fees and settlement delays in traditional finance make it difficult to support the massive micro-payments generated by AI agents. Stablecoins, with their low costs and instant settlement, provide an efficient, seamless underlying environment for 24/7 AI operations. Through programmability, AI agents can automatically execute transactions within preset budgets, without legal identities, enabling autonomous settlement—becoming the digital bloodline of agent commerce.

The Gap Between Ambition and Reality: $24 Million vs. $6.88 Trillion

However, all this optimism about technology relies on a key assumption: that demand will eventually emerge. Current data offers limited support for this premise.

For example, the early-stage x402 protocol, used as a reference for agent payments, has recorded on-chain activity over the past 30 days involving fewer than 100,000 buyers and 20,000 sellers, with a total volume of about $24 million. Compared to the projected $6.88 trillion global e-commerce market in 2026, this is just about 0.00035%. For a technology expected to “reshape payment tracks,” this is more like a proof of concept than a scaled adoption.

Even Circle’s USDC shows similar signs: with a circulation of about $75.3 billion and a quarterly on-chain volume surpassing $11.9 trillion in Q4 2025, most activity remains within institutional settlements, DeFi protocols, and exchange internal transfers. Truly consumer-driven, “agent payment” scenarios are almost indistinguishable within this total.

Chris Donat, head of Fintech at BWG Global, notes that it’s unlikely consumers will proactively demand stablecoin payments, and retailers lack strong incentives to overhaul their entire payment system for this demand gap. The tepid demand isn’t due to technical shortcomings but stems from user habits and the slow evolution of the business ecosystem.

Stripe’s approach exemplifies this tension: it offers about 1.5% acceptance fees for stablecoin payments in the US—attractive compared to nearly 2.9% for credit cards; yet, it treats stablecoins as an optional channel, patiently waiting for regulatory clarity, consumer education, and killer apps—conditions that are still far from being met.

Infrastructure First: How Do We Measure the Win or Loss?

Understanding Circle and Stripe’s current strategies requires viewing them through the lens of infrastructure industries rather than consumer goods. When AWS launched S3 and EC2 in 2006, cloud computing demand was nearly nonexistent; no companies knew they needed elastic compute resources until those options existed.

Perhaps, the pipeline comes before the flow—that’s the core logic of infrastructure betting.

From this perspective, Circle and Stripe’s early investments—whether in Arc’s development, the high costs of Tempo’s financing, or the billion-dollar acquisitions like Bridge—are more like “placeholder fees” than short-term profitable investments. They are betting that once AI-related transaction volumes grow from tens of millions to the next scale, the first to validate technology and achieve regulatory compliance will dominate the new era’s business.

But this logic is fragile: if demand arrives much later than expected, or if the actual shape of the market differs from current assumptions—say, traditional financial institutions like Visa develop their own agent-native payment solutions rather than being disrupted—then all the early infrastructure investments could be viewed as sunk costs in financial reports.

Citrini’s report’s true contribution isn’t so much in its accuracy of prediction, but in forcing industry leaders and investors to seriously reconsider: when transaction decision-makers shift from humans to software, every seemingly solid premise in existing business models must be re-evaluated.