Quick Take on WSJ – V/MA Near Deal w/ Merchants
Merchants have long expressed frustration over card costs, but it’s critical to separate signal from noise. Their issue isn’t with network fees—those average just 5 to 7 basis points and fund the global infrastructure that securely moves trillions. The real pressure point is interchange, often 250 basis points or more for premium rewards cards. That imbalance has shaped years of litigation, and now a potential reset is emerging.
It was truly fantastic catching up with so many of you in person at Money 2020! It’s clear that payments, AI, and digital assets are accelerating at an unbelievable pace. If you didn’t manage to make it, or if you were too busy grabbing coffee to focus on the news flow, here are my top takeaways from the floor. I hope to see some of you in Miami at Simon’s Fintech Nerdcon!
The core theme I kept hearing is that the future of commerce is moving rapidly toward machine-to-machine (M2M) interactions. As this happens, the role of V/MA networks (governance, economics, trust, identity, and authorization) becomes even more crucial. The technology is the easy part; the governance is the real competitive moat.
Continue readingStripe’s Agentic Commerce Protocol (ACP), co-developed with OpenAI, is a functional leap forward in enabling agentic commerce. While its open-source nature invites broad adoption, Stripe is uniquely able to “make it work” by leveraging its existing fraud-fighting assets. Another less reported benefit of ACP is payment rail agnostic operation. ACP will work for paybybank, PIX, EFTPOS, Swish, Bizum or anything else. Anywhere that Stipe’s device graph and Radar (Risk/Fraud) are effective. Stripe’s secure payment token plus risk signals allow merchants to operate the way they do today (no operational change).
ACP may only have a limited 2-3 yr runway as more advanced authentication methods become mainstream, and network rule sets/services advance to serve all agent providers (leveling the playing field).
Continue readingShort Blog
The x402 Foundation was publicly announced last week on September 23, 2025, as a joint initiative between Coinbase and Cloudflare. This effort aims to solve the governance issue in agentic. The design COULD SOLVE the governance issues outlined in Governance in Payments as well as last month’s Agentic Commerce Economics and Governance. As a refresh, my position is that monetization/governance is the Gordian knot preventing AI from moving to next stage of growth.
While Google’s AP2 suffers from a dependency on settlement governance and the inability to expand trust beyond their own domain (see AP2 blog), x402 is just a standard that handles payment terms negotiations between two APIs (both price and method). The foundation turns x402 into a “network) with an operational model, active governance and economics. My example is that an existing customer would have payment managed with a current card on file and the merchant owning risk, whereas a new customer (or new machine request) could agree on a non-refundable stablecoin payment.
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I’ve been writing about governance, trust, transaction costs and payments for a long time. In my view THE KEY to understanding how stablecoins, agentic, DeFi, Open Banking, tokenization and other payment innovations is governance. I seem to be the only one writing about it, so I don’t see a reason to stop now. Governance is the BIGGEST competitive moat for Visa and Mastercard, and its also the heart of their biggest break out growth opportunity. If you thought AI was transformational, radically reducing transaction costs (TCE per Nobel work of Ronald Coase) will dwarf it. In fact the monetization of AI is a Gordian knot of governance issues (see Agentic Commerce and Governance).
Today I’m expanding on “value exchange” governance with 5 core themes.
ApplePay turns 11 yrs old this month, a wallet that has gone from 0 to 84 countries and 11,000 banks. Hard to believe, my blog was the first to break the news of ApplePay in iPhone 6 back in 2014. Back then I was on the advisory board of Money2020, and asked M2020 co-founder Johnathan Weiner to hold a place in the agenda for Apple Pay. September rolled around and we still had an “empty” slot, I told him to trust me. It worked out well, as Apple finally rolled it out on September 9th 2014. There was so much innovation in the initial wallet from tokenization, provisioning, credentials in the secure enclave, … and of course the game of chicken Apple played with Issuers on their 15bs (in US, 7bps in EU see story).
I just installed iOS 26 this morning, so what’s new in iOS 26 w/ ApplePay?
Continue readingVery Short Blog
Zelle owner Early Warning Services exploring stablecoin [Issuance] for retail bank customers. https://finance.yahoo.com/news/zelle-owner-early-warning-services-exploring-stablecoin-for-retail-bank-customers-154503674.html
EWS is certainly the right consortium to Issue a SC given KYC and their existing RT Zelle settlement rails (which also integrate to TCH RTP). The CX interface for particiapting zelle banks is also there, setting up a “transfer” like issuance process. Within Online Banking the big change will be showing stablecoin balances in a new account or something.
Continue readingI’ve never been a fan of “Pay by Bank.” It’s a solution in search of a problem, especially when compared to the efficiency of debit cards and the global reach of Visa Direct. Now, two major developments have dealt a significant blow to the already weak business case for this payment method.
Continue readingIn a significant ruling on yesterday (Aug 7)) U.S. District Court Judge Daniel Traynor struck down “swipe fees” cap that non-exempt banks can charge merchants for debit card transactions. The decision found that the Federal Reserve had exceeded its authority by allowing these fees to be higher than intended by law (ie include provisions for “fraud”).
Rumors are that a substantial organizational change at PayPal is in progress. Frankly, it’s overdue. For any global payments company to succeed, its leaders must possess a deep, almost intuitive, understanding of the global payments ecosystem. This is where PayPal is currently failing.
We have a CEO, Alex Chriss, known as a product specialist. While he may be excellent at getting products out the door, this is not the problem PayPal faces. Unfortunately, the team can’t see the forest fire given their conspicuously poor payment background. For example, look at Diego Scotti as EVP and GM of the consumer group. His experience comes from Verizon, and his chief credential is that he is the husband of Janey Whiteside, one of Alex’s closest payment advisors. When growth doesn’t happen and targets get missed, investors begin to look for the reasons and the resumes of those running the ship.