Shawn Yu, ROZO Co-founder, building Visa Layer for Stablecoins.
For years, volatility was the easiest objection to digital assets payments. Why would a merchant accept a payment instrument that might lose value before the end of the day?
Stablecoins answered part of that question by solving for volatility. A dollar-denominated digital asset keeps the unit of account familiar while using programmable settlement rails. However, they did not solve payments, as there are still challenges in recovering the payment after the transaction has been made.
McKinsey estimates that B2B stablecoin payments account for about $226 billion a year. At that scale, recovery of these payments becomes an infrastructure question, not an edge case.
The industry has made enormous progress on settlement infrastructure. It has not made comparable progress on payment recovery. That leaves a practical gap: A transfer can settle on-chain while the merchant still cannot treat the order as paid.
Why Transaction Success Is Not Payment Success
In a mature payment system, success is judged by whether the intended commercial outcome happened. Did the merchant recognize the payment? Did the payer send the correct amount? Did it arrive within the required window? If something went wrong, is there a known path for investigation?
Blockchain-based payments often collapse these questions into one question: Did the transaction settle? That is too narrow.
Consider a $10 payment. A merchant requests USDC. The customer also holds USDC. This should be easy. But USDC is not a single operational environment. USDC is natively supported on many blockchain networks, but each network has its own routing rules, fees and confirmation behavior.
That means a user can send the right dollar asset on the wrong network. If the ledger records a valid transfer, the transaction allegedly succeeded. Yet the merchant’s checkout system may never mark the invoice as paid.
The same pattern appears in ordinary situations: A user sends USDT when the invoice expected USDC, sends funds to the wrong address, omits a required exchange memo or tag, or withdraws from an exchange without realizing the network fee will make the merchant receive less than the invoice amount.
None of these examples requires fraud. They are honest payment mistakes.
The problem is that many digital asset checkout flows still expect ordinary users to understand wallet addresses, networks, token standards, gas tokens, confirmations and supported assets before making a small payment. For most customers, that feels less like checkout and more like being handed the back office.
Solving The Missing Layer: Payment Recovery
It is tempting to blame these failures on immutability, but that is too simple.
Final settlement is one reason blockchain-based payments are interesting in the first place. It can reduce settlement risk and give merchants more certainty. For some use cases, finality is a feature, not a flaw.
The problem is not that settlement is final but that the industry has not built enough processes around what happens after an honest mistake.
Traditional payment systems evolved dispute handling, chargebacks and error-resolution procedures because transactions may process correctly while humans still make mistakes.
In the U.S., many consumer electronic transfers operate within frameworks such as Regulation E, which gives consumers a defined way to report certain errors. Digital asset payments should not copy these systems exactly, but mainstream payment systems became mainstream only after they developed processes for exceptions.
The answer is not to turn every digital asset payment into a chargeback system. That could undermine final settlement, increase merchant risk and recreate delays.
Instead, as my team and others across the infrastructure ecosystem are finding, what’s missing is a different category of infrastructure: a payment recovery layer.
A payment recovery layer is not a reversal button or universal refund right. Instead, it should make payment mistakes less likely, easier to detect and easier to recover from when recovery is technically possible. It should prevent pre-payment errors, define payment intent clearly and coordinate recovery when technically feasible.
A checkout flow should know the recipient, accepted asset, accepted networks, required memo or tag, invoice amount, expiration time and expected net received amount.
Sometimes, funds are irretrievable. Sometimes, they are sitting in a custodial account and can be credited or returned. The system should make these states explicit instead of leaving users in support limbo.
Building A Framework For Payment Resolution
The need is already visible. Binance reported in 2023 that it processed about 4,000 deposit-retrieval applications each month, restoring roughly 7 million USDT in value. Kraken publishes a $200 fee to refund an unsupported token sent on a supported network and a $500 fee for an unlisted asset sent on an unsupported network. Recovering a small mistaken payment can cost more than the payment itself.
For payment companies, this is also an operational cost issue. A $10 failed payment can create more than $10 of support burden: tickets, screenshots, block explorers, manual reviews and delayed refunds.
Before launching stablecoin payments, leaders should ask questions that go beyond settlement speed. Can the system tell the user what to send and what not to send? Can it verify network, asset, memo and address compatibility before signing? Can the merchant distinguish “transaction settled” from “invoice paid”?
The next challenge is not another blockchain, bridge or wallet feature. Those may help, but they do not answer the central question: What happens when the payment goes wrong?
For the industry, solving the recovery layer starts with identity. Most wallets are anonymous. When someone claims a mistake, the platform cannot prove whose money it is, so the safest answer is no refund, putting the burden entirely on the user. Add fragmented standards and rules that change at every border, and each error becomes a manual investigation.
The fix is not to train users, and the industry will need to ensure that buyers never have to think about networks, tokens or memos if recovery is going to shape how merchants choose payment providers, much as fraud protection did for cards.
The industry has spent years proving that blockchain-based settlement can work. The next test is whether it works for people who simply want to pay $10 and move on.
Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
