The eternal fragments of money: third-party payments have no first principles

Author: Zao Ye, Crooked-Neck Mountain

Four generations of the payment industry under one roof

A storm is coming and the wind is full of the楼—Stripe is again trying to acquire PayPal. The wheel of fortune turns; last time it was 30 years ago, when Peter Thiel’s PayPal merged with Musk’s original X.com.

I don’t understand why everyone is talking about PayPal’s lackluster growth, as if this FinTech race is heading for doom for us. Twenty years ago, Peter Thiel set out on a journey from payments and started his first business—PayPal’s mafia-style consolidation, and it quickly became supreme. Wherever Musk went, the public welcomed him wholeheartedly; you could truly see that era’s timing and that state of vigorous vitality, where everything thrives. Only after those short twenty years—has Payment somehow become the place where we’re meant to be buried?

Growth is a miracle; stablecoins are not

Stripe didn’t go public during the pandemic; turns out that was a mistake.

All of Stripe’s efforts were to chase an out-of-reach dream of an IPO. Against the backdrop of the pandemic era’s massive liquidity easing, Stripe first reached $100B valuation.

But it didn’t go public like Coinbase and others, causing its valuation to fall again and again—mistaking the opportunities of the times for personal effort. So, after painful reflection, Stripe opened the M&A road.

Stripe started with a Dev-friendly approach: APIs can be integrated in a single click. The temptation for developers was not small—this is also the payments industry’s most distinctive tactic. It doesn’t get stuck on fees and scenarios; instead, it reaches the people behind the scenes who actually do the work.

Stripe hopes to reuse its own experience again and again: entering acquiring systems from the B side, entering stablecoins from the C side, and even laying out the ACP/MPP protocol on the Agent side—hoping to reshape the entire payments industry.

Image description: Stripe’s bumpy IPO road

Image source: @zuoyeweb3

The payments industry has always had two characteristics, and they also prevent Stripe from continuing to move forward:

• The highly fragmented industry structure remains unchanged. Once you can carve out a country, an industry, or even just a few companies, you can keep barely surviving—without being directly wiped out by external forces;

• Payments are an appendage of the banking industry. For developers and B/C-side enterprises alike, they ultimately externalize bank processes, and stablecoins are eventually brought into the banking track as well.

Especially the series of stablecoin-related acquisitions—from Bridge’s issuance, to Privy’s wallet entry, and even to Tempo and OpenUSD—it’s hard to imagine repeating Stripe’s past glory.

This latest proposal to acquire PayPal is, in fact, Stripe’s attempt to use the phased result of losing on the C side with stablecoins, trying to make up the gap with PayPal’s C-side business.

PayPal’s problem isn’t that it can’t keep up with the times. From Venmo to PYUSD, nothing has rescued PayPal’s downward trend.

In other words, PayPal is simply too old. The company’s structural dysfunction is no longer something that can be revived simply by starting new businesses.

With Stripe starting later, it also wants to add more narrative possibilities for itself before the IPO.

If Stripe wrapped the back end to capture the developer market, then the stablecoin market wrapping the front end—the story of the issuance network—has likely largely come to an end. Tempo and OpenUSD may push down or challenge Circle’s stock price, but they won’t move Tether at all.

If Stripe’s ceiling is only Coinbase or Circle, then going public is destined to result in an outcome like a broken offering. Compared with Adyen’s market cap and Air-Cloud Exchange’s valuation, Stripe’s stablecoin narrative as the X Agent narrative is useful.

Stablecoins are not a routine part of the current payments system; they are a visible trend.

And Agent still needs to find an entry point to get into the existing system.

On the upside in the news, Agent is already using stablecoins to buy compute power and Tokens at scale. But aside from suspicions about inflating numbers, Agent still hasn’t entered Web3 businesses—let alone more conservative companies or bank systems.

Image description: Agent is currently mainly used to generate volume

Image source: @BarkerMoneyX

A side (the future), B side, C side, D side (making a fortune)—but Stripe’s valuation is hard to escape the reasonable value ceiling of 50B in the FinTech range; 100B contains too many proactive imagined possibilities.

If it can’t reach the future even briefly, then expanding scale and ecosystem is Stripe’s only remaining point where it can exert force—you can think of Stripe as an option product.

• Agent will use the OUSD stablecoin and run it on top of Tempo; Stripe should be on the scale of Visa;

• Agent will use stablecoins, but if OUSD fails and Tempo captures part of the market, Stripe should have a valuation of 100B plus Tempo public-chain valuation;

• Agent’s economics are hard to become real. If “Agentic Payment” gets overtaken by a new concept, then at the very least Stripe still has its own existing business.

Investment losses are of course a blunder. But missing out would be a lifelong regret. Looking at the problems Stripe posed to the primary market and heading forward—how the entire payments industry will evolve from there—is also worth thinking about further.

Payments are just the entry; value-added services are where the profits come from

Agent is the future you can see with your eyes—provided it can live to that day.

Standing in mid-2026, this is a very delicate node: the clear law passes within the final window, and stablecoin yields may be decided with a single stroke.

Meanwhile, the long-term future of Agent economics—today’s focus is concentrated on replacement models for office workers and blue-collar workers, as well as hardware areas such as new wearable devices and AIOS phones.

As for how Agent will transform payments, it hasn’t drawn widespread social attention. There’s reason to believe this is the opportunity hidden in stablecoins—the β opportunity delivered by the times.

Image description: The payments industry of perpetual motion

Image source: @zuoyeweb3

However, the operating model that the payments industry built in the past using “licenses + localization” may face ongoing pressure from clearing networks.

Even with stablecoins, the front end still needs entry points such as deposits, and the back end still has exits such as on-chain circulation, settlement, and cash-outs into accounts—this is also the compliance backbone of the banking industry.

In the FinTech wave driven by the internet over the past 30 years, it ultimately strengthened the banking industry’s ability to constrain payments. It didn’t get directly transformed away and disappear the way publishing, consumption, entertainment, dining, and others were.

Under technology waves, banks have become increasingly transparent, yet they always control the end-touch for cash and the terminal tentacles of account-opening branches. In a sense, the fragmentation of the payments industry can be attributed to the banking industry’s division by blocks and regions, while licensing and sovereignty boundaries are nothing more than an acknowledgment of reality.

But in the moves by Stripe and Circle, there’s another possibility for payments: stablecoin customer acquisition on the front end, and clearing profits on the back end.

Stripe and Circle are actually quite similar. They both represent a future intersection of FinTech and Crypto: building public chains (Tempo vs Arc), stablecoins (OUSD vs USDC), and clearing networks.

The reason it’s not a revenue-sharing model from stablecoin issuance is that Circle has already started subsidizing Hyperliquid channel partners, and OUSD directly shares profits with partners. Since both sides have already begun internal “involution,” it’s not the future.

But for the clearing system, for the first time it allows their public chains to not have to forcibly subsidize partners, and instead earn the revenue from payments and stablecoin network effects purely through capital efficiency.

Clearing systems aren’t complicated. Traditional fiat clearing relies on card organizations, SWIFT, central banks across countries, and commercial banks—stacked layer upon layer, it has long been overloaded.

Emerging stablecoin public chains have no historical baggage, so they can focus their effort on improving clearing efficiency. And once Circle and Stripe secure OCC-licensed bank licenses (approved with conditions), after they distribute stablecoin profits, they will inevitably move toward clearing.

And a clearing network may be able to partially detach from the commercial banking system and keep profits within itself.

Conclusion

Stripe missed the IPO window during the pandemic and entered the trench-war of third-party payments. This campaign follows the eternal Verdun model—one that can never rely on scale alone to crush small players across each local area and each industry.