Stablecoin Wars With Stripe And Circle Racing To Control Payments

Stripe and Circle both are launching stablecoin blockchains. (Photo by Nikos Pekiaridis/NurPhoto via Getty Images)

NurPhoto via Getty Images

Now that stablecoins are suddenly top of mind in the United States, I’ve been getting more questions about them than ever before. Just last week, over breakfast with a few friends, one of them leaned in and asked, “Okay, but what exactly is a stablecoin?”

I told them to think of it as a bridge between the old world of money and the new world of crypto. A stablecoin is a digital asset designed to keep its value steady, usually by pegging it to something like the U.S. dollar or even gold. It’s like having all the speed, transparency, and innovation of blockchain, but without the wild price swings that make other cryptocurrencies feel like a rollercoaster.

That conversation was still fresh in my mind when, in August 2025, two of the most influential players in global fintech made moves that could redefine the future of stablecoins. Stripe and Circle each announced they’re building their own specialized blockchains, tailor-made for stablecoin transactions and next-generation payment processing. It’s not just another tech headline.

It’s the beginning of a race to control the rails of tomorrow’s digital payments.

Stripe’s Tempo: Speed Meets Reliability for Stablecoin Payments

Stripe has long been the quiet powerhouse of online commerce, powering checkouts for everyone from small Etsy shops to massive e-commerce platforms. With its new blockchain project called Tempo, Stripe is stepping deeper into the financial infrastructure game.

Built in stealth with crypto investment firm Paradigm, Tempo is designed as a high-performance, payments-focused blockchain that’s fully compatible with Ethereum’s development tools. That means developers can use familiar programming languages and tap into the largest pool of blockchain developers in the world.

But Stripe’s real advantage isn’t just technical.

They can plug Tempo directly into the massive merchant network already using Stripe. Imagine buying something online, paying with a stablecoin, and the merchant getting their funds almost instantly without the card processing fees or multi-day settlement delays. Recurring subscriptions, escrow services, and even cross-border payments could all run natively on Tempo.

By owning its own blockchain infrastructure, Stripe can control speed, costs, and uptime in a way it couldn’t if it relied solely on public networks.

That’s a big deal for merchants who care about reliability as much as revenue.

Circle’s Arc: A Stablecoin First Digital Economy

Circle took a different approach with its new blockchain called Arc, built entirely around USDC (their dollar-backed stablecoin). USDC isn’t just a payment option on Arc; it’s the native currency that powers every transaction on the network. Arc promises near-instant settlement, optional privacy for transactions, compatibility with existing developer tools, and even an integrated foreign exchange engine for swapping between different currencies.

The design makes Arc feel less like a general-purpose blockchain and more like a purpose-built financial backbone.

The vision?

Arc becomes the go-to network for cross-border payments, institutional settlements, and multi-currency transactions, all anchored by their USDC stablecoin. It’s a strategy that could lock in USDC’s role as the default currency of blockchain-based finance.

For businesses, Arc could mean sending a payment overseas and having it arrive in seconds, with no intermediaries taking a cut. It could also mean instantly swapping currencies at the point of payment, reducing foreign exchange risk.

The Stablecoin Competition Heats Up

Stripe and Circle aren’t alone in this race. Several other projects are competing to define the next generation of stablecoin-ready networks.

Plasma just raised over $373 million in funding, with strong institutional backing and a design clearly aimed at the same high-performance, finance-driven market as Tempo and Arc.

Meanwhile, Stable is building a blockchain centered around Tether (USDT), designed to handle the massive transaction volumes of the world’s most-traded stablecoin.

“We’re witnessing the infrastructure wars of digital finance,” says Dr Nikhil Varma, Senior Executive Fellow at The Digital Economist. “Every major player realizes that controlling the rails means controlling the future of payments. It’s not just about building a better network—it’s about becoming the standard that everyone else has to work with.”

According to the Digital Economist Industry Outlook: Blockchain & Digital Assets 2025-26 report, stablecoins now “consistently dominate blockchain transactions,” showing the market has matured beyond speculative trading. The report highlights that one of the most impactful real-world applications has been international money transfers, offering lower costs, faster speeds, and fewer middlemen than traditional wire transfers.

Why This Stablecoin Shift Matters for Business

In the early days of blockchain, most fintech and payment companies simply built their services on top of existing public networks like Ethereum. Now, the trend is shifting, and the biggest players are building their own infrastructure.

Owning the base layer means controlling the economics, the upgrade timeline, and the performance guarantees. It means not having to explain to merchants why their payments got stuck because of network congestion on the other side of the world.

For businesses, this creates more options. A retailer might adopt Tempo for checkout, enjoying instant stablecoin settlement and lower fees. A multinational corporation might build on Arc for payroll and benefit from real-time currency conversion. Financial institutions might create new products that run directly on these specialized networks.

The Risks Worth Considering in Stablecoin

Committing deeply to one network’s ecosystem could create new dependencies. If a business builds extensively into Arc or Tempo, switching later might be expensive or impractical.

There’s also the regulatory landscape to consider.

Stablecoins are in the spotlight globally, and rules vary widely by region. While the U.S. is becoming more welcoming, other areas are taking a slower or more restrictive approach. Any network aiming for global reach will need to navigate a complex web of compliance requirements.

The Stablecoin Infrastructure Advantage

In the payments world, “owning the rails” has always been the ultimate position of power. In the blockchain era, it means controlling the foundational network that transactions actually run on.

For Stripe, that could mean fine-tuning Tempo for ultra-fast retail payments, loyalty programs, and merchant-friendly settlement processes. For Circle, it could mean establishing USDC as the currency powering everything from consumer purchases to institutional trades.

If Arc or Tempo can set the standard for how stablecoin transactions work (speed, security, privacy, and compatibility), they’ll have a first-mover advantage that’s difficult to overcome.

What’s Next for Stablecoin Networks

The competition between Stripe’s Tempo and Circle’s Arc is just beginning. And while both are starting with stablecoin payments, their ambitions are much bigger.

We may see Stripe expanding Tempo into areas like digital identity verification for merchants or merchant-issued loyalty tokens. Circle could extend Arc into tokenized financial markets, enabling instant bond settlement or stablecoin-based derivatives trading.

What’s certain is that we’re entering a future where payments infrastructure is as much a competitive advantage as pricing or customer experience. Whether it’s Tempo, Arc, Plasma, or Stable that ends up leading, the message is clear: the most powerful companies in finance are no longer content to build on someone else’s foundation.

They want to own the rails and, in the process, shape how money moves in the digital economy for decades to come.

Why the Stablecoin Winds Have Shifted

A few years ago, the road for blockchain and stablecoins felt uphill. Rules were unclear, most people didn’t understand the technology, and money flowing into the space was cautious.

Fast forward to today, and the breeze is at our backs. Governments are starting to set clearer rules like the Genius Act. More businesses and everyday people are using blockchain in practical ways. The technology itself has gotten easier to use and more reliable, and the money coming into the industry is growing.

In the short term, we’re also seeing things that could give it an extra push like new investment products, clearer guidelines for how companies can safely launch tokens, and better ways to connect traditional finance with blockchain.

For Stripe and Circle, launching Tempo and Arc now means they’re setting sail with the wind working for them, not against them and stablecoins.

Did you enjoy this story about Stablecoin? Don’t miss my next one: Use the blue follow button at the top of the article near my byline to follow more of my work on crypto, AI, and stablecoin.