Why is stablecoin difficult to replace credit cards? The moat of credit cards is not payment, but consumption before repayment More and more people are researching how to replace credit cards with stablecoins, but I think the biggest problem with this statement is that it interprets credit cards as mere payment tools. And this approach is highly likely to be wrong, especially in high paying countries like Europe and America where per capita savings are low. If it's just payment in stablecoins, of course it's possible. USDT and USDC can be used for transfers, merchant receipts, and cross-border settlement efficiency. But the real necessity of credit cards is not payment, but credit, the logic of first consumption and then repayment, and even the logic of being able to exchange for the minimum amount. Stablecoins require deposit before payment, while credit cards require payment before repayment. These two logics are completely different. The United States is the most typical sample. In April 2026, the personal savings rate in the United States was only 2.6%. A survey by the Federal Reserve shows that only 63% of American adults can pay $400 in emergency expenses in cash or its equivalent, and only 55% of adults have three months of emergency savings. Europe is better than the United States. The household savings rate in the Eurozone for the fourth quarter of 2025 is 14.4%, but compared to high savings regions in Asia, Europe is only a younger brother. The savings rate of Chinese households is approximately 31%, the personal savings rate in Singapore in the first quarter of 2026 is 39.2%, and the total savings rate of households in South Korea in the first quarter is also over 40%. This indicates that what many people in Europe and America lack is not a new payment method, but a cash flow buffer. However, the long-term credit card debt in the United States has exceeded $1.2 trillion, with credit card consumption reaching $3.6 trillion in 2024. The average APR of general credit cards has reached 25.2%, and there are still a large number of users who only pay the minimum repayment, with active account rolling balance ratios approaching half. Why do people continue to use such expensive interest rates? Because for many American consumers, credit cards are no longer just a payment tool, but a daily cash flow tool. I don't have any money today, so I can use my credit card first. This month's cash flow is tight, so you can start by using your credit card. If the full payment is not made by the end of the month, the minimum repayment can be made first. If there is a problem with buying something, you can also dispute the transaction. Daily consumption includes points, cashback, mileage, insurance, and extended coverage. These things together are the true moat of credit cards. Do you remember that Trump said he would lower the maximum interest rate of American credit cards to 10%? Although this matter has not yet been truly implemented. But this detail is actually very important. If a credit card were just a payment tool, there wouldn't be so much resistance to limiting interest rates. What truly affects the interests of banks is the consumer credit income behind credit cards. In 2024, American consumers will pay over $160 billion in credit card interest alone, along with $31.3 billion in various fees. That is to say, the real source of profit for credit cards is not just merchant fees, but also consumers' rolling balances, installment payments, minimum repayments, and interest income. Merchants certainly prefer lower cost settlements, but why do consumers give up credit limits, interest free periods, minimum repayments, point cashback, and chargeback protection? Stablecoins can make money arrive faster, but they cannot solve the problem of users being able to continue spending when they run out of money. Some people may ask if PayFi can solve this problem. In theory, it seems to be possible, but in reality, it is still not enough and even more difficult to promote than direct stablecoin payments. This is also why PayFi has hardly been mentioned so far. PayFi requires a larger 'startup' capital. The most difficult part of credit is mainly risk control. Disbursement is only the first step, and later it is necessary to determine the user's income, consumption habits, repayment history, default probability, fraud risk, and whether they will directly default during economic downturns. So stablecoins, which want to replace credit cards, still cannot be implemented in Europe and America through fast transfer, fast settlement, and low-cost channels. Instead, Asia may be more suitable for stablecoin payments to emerge first. Many markets in Asia have long been dominated by wallets, QR codes, bank transfers, instant payments, and balance payments. Users have become accustomed to putting money into their wallets first and then scanning the code to make payments. Merchants are also accustomed to instant payment, and platforms are accustomed to using a balance system as a closed loop. So stablecoins have greater opportunities in Asia. Of course, Asia is not as open to stablecoins as Europe and the United States, but precisely because the Asian market is more complex, the real demand for stablecoins is more apparent. The value of stablecoins will be more direct for European and American consumers to replace credit cards with them. Especially in Southeast Asia, Hong Kong, Singapore and other places, stablecoins are more easily integrated into cross-border trade, tourism payments, merchant settlements, B2B payments, freelance payments, game recharge, e-commerce platforms, and US dollar denominated asset payments. The core requirement of these scenarios is not to let users spend future money first, but to enable existing money to complete cross-border transactions faster, cheaper, and more stably. This is the most realistic home ground for stablecoins at present. But on the other hand, it is difficult to implement this type of payment without regulatory intervention, which has instead created a payment paradox in Asia. (Let's not talk about this topic for now) So stablecoins are difficult to replace credit cards in the short term, especially in markets like the United States that heavily rely on consumer credit. Credit cards solve the problem of spending first and then repaying. Stablecoins solve the problem of having a balance before settlement. Although both are called payments, the needs of users are completely different. end!