How WalletConnect and new rules in Europe could reshape stablecoin payments

Stablecoins and crypto payments are moving from niche to mainstream, and a lot of that shift is happening quietly in the background. One of the key players is WalletConnect, which connects hundreds of wallets to tens of thousands of apps. Its CEO, Jess Houlgrave, recently shared how on-chain payments are rolling out to physical stores, what Europe’s new MiCA rules mean for Tether and other stablecoins, and why euro-denominated coins may be the next big catalyst for adoption.

What WalletConnect actually does

WalletConnect has been around since 2018 as a core piece of crypto infrastructure. At its simplest, it’s the connection layer that lets a crypto wallet talk to a dApp, exchange, game, or payment terminal. Today, more than 700 wallets and over 80,000 applications sit on the WalletConnect network.

The base network is open-source and free to join. On top of that, WalletConnect builds commercial products for specific use cases. One of the most important is WalletConnect Pay, which is designed to let payment companies and merchants accept on-chain crypto and stablecoin payments in stores and online.

Unlike most “crypto cards” that convert crypto to fiat behind the scenes and then run on Visa or Mastercard rails, WalletConnect Pay keeps the payment fully on-chain from end to end. Off-ramping to fiat can still happen at the back end if a partner wants it, but the core transaction is a pure on-chain payment.

Bringing on-chain payments to real-world stores

WalletConnect is working with major point-of-sale (POS) providers to make paying with stablecoins as easy as tapping your phone or scanning a QR code. One of the biggest partners is Ingenico, a global POS giant with around 40 million merchant terminals worldwide, from gas stations to luxury boutiques and restaurants.

The rollout is starting with pilot stores in Europe this summer. These pilots are focused on refining the user experience: how a customer initiates a payment, how the merchant sees it, and how quickly it settles. Once the experience is polished, the plan is to expand globally with Ingenico and its acquiring partners.

Importantly, WalletConnect wants to be hardware- and software-agnostic. The team is building SDKs, APKs, and API-based integrations so that different POS manufacturers and software providers can plug in WalletConnect Pay in whatever way fits their systems, including soft-POS setups that run on phones or tablets.

QR codes, tap to pay, and making crypto feel familiar

Crypto payments can’t go mainstream if they feel alien to everyday users. WalletConnect is deliberately leaning into familiar payment experiences:

• QR codes are already ubiquitous in places like Southeast Asia, where people regularly scan codes to pay with local wallets and apps.
• Tap to pay dominates in Europe and is increasingly common in the US, where people simply tap a phone or card at the terminal.

WalletConnect supports QR-based flows today and is investing heavily in tap-to-pay experiences. The idea is that the customer should be able to pay with their existing crypto wallet, but the interaction at the terminal should feel just like using Apple Pay or a contactless card.

Another design goal is to hide crypto complexity from retail staff. Cashiers shouldn’t need to ask which chain a customer is using or which token they want to spend. WalletConnect’s network-level abstraction means the wallet handles chain and asset selection, while the POS just sees a successful payment.

MiCA, Tether delistings, and the rise of euro stablecoins

Europe’s new MiCA framework is starting to bite, and one of the first visible effects is the delisting of Tether’s USDT from some EU platforms. That raises obvious questions for any company building stablecoin payment rails in the region.

WalletConnect itself is chain- and asset-agnostic. It doesn’t hold funds or act as a regulated payment institution; it provides the technology that payment companies and merchants use. Those regulated partners decide which assets they’re willing or allowed to accept.

Jess Houlgrave expects many European payment partners to simply opt out of USDT as a supported asset under MiCA. However, that doesn’t necessarily mean users won’t be able to start a payment in USDT. In theory, a wallet could perform an on-chain swap (for example, USDT to a compliant euro stablecoin or USDC) as part of the payment flow, so that the merchant and regulated payment processor never actually touch USDT. The technology for this exists today via DeFi swaps; the question is whether regulators and payment partners will be comfortable with that model.

More broadly, MiCA is accelerating a shift toward euro-denominated stablecoins and other local currency coins (like Swiss francs or Swedish krona). For most Europeans, salaries, bills, and everyday purchases are in euros, so paying in a euro stablecoin is more intuitive than paying in a dollar-pegged asset.

Even with EU restrictions, USDT remains the dominant stablecoin across Asia and the Middle East, where it’s widely used for trading, remittances, and cross-border commerce. That means MiCA is unlikely to trigger a global “downfall of Tether,” but it will reshape which coins are used where.

If you want a broader view on how stablecoins are evolving and why their growing share of the market matters, it’s worth reading this deeper look at rising stablecoin dominance.

Is MiCA good or bad for crypto innovation?

Only 196 crypto firms reportedly secured licenses out of roughly 3,000 registered entities in the EU, which sounds like a brutal purge. The natural worry is that heavy-handed rules will choke innovation.

Houlgrave’s view is more balanced. MiCA is far from perfect, but it does provide something the industry has been begging for: clear rules. Most serious companies want to be compliant; they just need to know what compliance actually means. That clarity is one reason Europe has become attractive for crypto businesses, especially compared to jurisdictions where rules are vague or enforced inconsistently.

Some older or lightly regulated projects will fall away because they can’t or won’t meet the new standards. At the same time, major US players like Circle are expanding aggressively into Europe, and several EU countries are actively courting crypto businesses. The net effect is likely a smaller but more robust set of regulated players in the region.

USDC, Tether, and who wins in Europe

Circle has secured full MiCA compliance for USDC in Europe, which puts it in a strong position as USDT faces restrictions. That could lead to a significant increase in USDC usage in the region, especially for institutional and regulated use cases.

However, Houlgrave doesn’t see this as a simple “USDC vs USDT” winner-takes-all scenario. In Europe, the real growth may come from euro stablecoins and other local currency tokens that better match how people think about money day to day. Globally, USDT is still deeply entrenched in markets like Asia and the Middle East, and Tether has a track record of adapting quickly.

For a broader context on how big the stablecoin opportunity could get, including how it intersects with AI and tokenized finance, see this analysis of the AI–stablecoin boom.

How WalletConnect makes money

The WalletConnect network itself is free to use. That open base layer is what lets small and large projects alike plug into the same 700+ wallets without paying for basic connectivity.

Revenue comes from commercial products built on top of that network:

• Developer toolkits and SDKs sold on a SaaS model, with entry tiers starting around $79 per month.
• Custom payment solutions like WalletConnect Pay, which can include transaction-based fees and tailored integrations for payment companies, banks, and large merchants.

Pricing varies widely depending on how complex the solution is. A simple developer integration might just be a flat subscription, while a full end-to-end, compliant stablecoin payment stack for a large processor will be structured very differently.

Crushing merchant fees with on-chain payments

One of the biggest promises of on-chain payments is cost. Traditional card payments often cost merchants 2–3% per transaction, and cross-border payments can run as high as 5–8%. Large retailers with negotiating power sometimes get sub-1% rates, but that’s the exception, not the rule.

WalletConnect’s goal with WalletConnect Pay is to bring those costs down dramatically. Because payments stay on-chain and don’t require card networks like Visa or Mastercard, there’s room to compress fees to the range of roughly 20–50 basis points (0.20–0.50%), depending on the flow and compliance requirements.

Those fees need to cover all the parties in the chain, including wallets and payment processors, but they still represent a major saving for merchants operating on thin margins. For businesses where almost all sales are now electronic—whether via cards or digital wallets—shaving even 1–2% off payment costs can be a big deal.

Privacy, compliance, and the travel rule

Cash is still the gold standard for payment privacy, and blockchains, by design, are mostly transparent. That raises two issues: regulatory compliance and user privacy.

On the compliance side, many jurisdictions now have “travel rule” requirements that force payment providers to collect certain information about senders and recipients above specific thresholds (for example, transactions over $1,000). WalletConnect’s tools let regulated payment companies collect this data from users in a secure, encrypted way and attach it to the transaction flow for compliance purposes.

On the privacy side, WalletConnect can’t change the fact that most blockchains are public, but it can design systems that minimize what’s exposed. For example, it can avoid directly linking a user’s off-chain identity to a merchant’s on-chain address in an obvious way. At the same time, the broader crypto industry is working on privacy-focused chains and protocols that could eventually make private, compliant payments more practical at scale.

What US regulation could mean for WalletConnect

In the US, stablecoin-focused legislation like the Clarity Act (and earlier, the FIT21 and Lummis–Gillibrand efforts) aims to define how dollar-pegged tokens are issued and regulated. For a company like WalletConnect, which sits at the infrastructure layer, the direct impact is less about being regulated itself and more about what its partners are allowed to do.

Houlgrave notes that banks, payment companies, and tokenization platforms all want the same thing: clear, durable rules about which stablecoins and chains they can use. When that clarity arrives, it tends to unlock projects that have been sitting on the shelf, waiting for legal green lights. The expectation inside much of the industry is that meaningful US clarity on stablecoins would act as another major catalyst for adoption, similar to what MiCA is doing in Europe.

Crypto cards vs native on-chain payments

Crypto-linked cards have exploded over the past six months. These products typically work like debit cards: you hold crypto or stablecoins in a wallet, and when you spend, the provider converts your balance to fiat and sends it over traditional card rails. Some are experimenting with pseudo-credit features on top.

Houlgrave sees the growth of these cards as a strong signal that people want to hold and spend crypto. But they don’t solve everything. For merchants, crypto cards still look and feel like normal card payments, with the same settlement times and similar fees. The benefits of instant, low-cost on-chain settlement don’t reach the merchant.

Native on-chain payments, by contrast, can deliver those benefits end to end. In the long run, as more of the payment stack moves fully on-chain, the industry can combine the user familiarity of cards and mobile wallets with the cost and speed advantages of blockchains.

Incentives, rewards, and the WCT token

To change consumer behavior, incentives matter. WalletConnect is already thinking about how to use rewards to nudge users toward on-chain payments. Imagine opening your wallet at a café and seeing an offer: “Pay with Coin X on Chain Y and get 3% cashback.” That kind of targeted incentive can be powerful.

WalletConnect’s native token, WCT, plays a role here. It’s used for governance of the network and can also be used as a reward token—for example, as cashback when people pay via WalletConnect Pay. The core network remains free to use, but WCT gives the project a way to experiment with new incentive models without changing the underlying connectivity layer.

Beyond humans: agentic payments and AI

As AI agents become more capable, they’ll need ways to pay for services, subscriptions, and data on behalf of users. That raises tricky questions about key management and security. You don’t want to hand an AI your private key, and you don’t want to juggle dozens of separate wallets for different agents either.

WalletConnect has already released an agentic SDK that lets AI agents use a user’s existing wallet under delegated permissions. Instead of sharing private keys or moving funds into separate wallets, you can grant an agent limited rights to initiate certain payments via your wallet. The SDK is compatible with emerging standards like EIP-3074-style delegation and 402 payment patterns, and it’s available for developers to build with today.

How critical is WalletConnect to crypto?

WalletConnect is deeply embedded in the crypto ecosystem. In the last year alone, it facilitated around $400 billion in transaction volume across institutional and retail use cases. If it went offline for a week, the disruption would be severe: countless dApps, wallets, and services rely on it for basic connectivity.

That level of importance is why the team focuses heavily on reliability and redundancy. While the entire crypto market wouldn’t literally collapse without WalletConnect, a significant portion of everyday activity would be affected until alternative connection methods or backups kicked in.

The road ahead: from crypto niche to everyday payments

Putting all of this together, a clear picture emerges:

• MiCA is forcing a reshuffle of which stablecoins can be used in Europe, pushing growth in euro and local currency stablecoins.
• USDT will likely remain dominant in many non-EU markets, while USDC and compliant euro coins gain ground in regulated environments.
• On-chain payment rails like WalletConnect Pay can slash merchant fees and settlement times compared to traditional card networks.
• UX improvements like tap to pay and QR flows, combined with incentives and rewards, will be key to getting everyday users comfortable with paying in crypto.
• Clearer regulation in both the EU and US is acting as a catalyst, not a brake, for serious players building in the space.

If these trends continue, millions of people could be using WalletConnect-powered payments in the next few years—often without realizing it—whether they’re tapping a phone at a checkout counter, letting an AI agent renew a subscription, or paying online with a euro stablecoin instead of a card.