The Future of Payment Infrastructure Could Be Permissionless
Originally published in Liberty Street Economics (Federal Reserve Bank of New York) on November 25, 2025, by Rod Garratt and Michael Junho Lee.
The authors argue that payment stablecoins' key advantage comes not from their monetary form but from their transfer over permissionless blockchains, which enable borderless, peer-to-peer settlement without institutional intermediaries. While acknowledging competition from domestic alternatives like FedNow, they contend that the universal accessibility of permissionless infrastructure sets it apart for international payments and underbanked populations, provided challenges around regulation, user experience, and scalability are addressed.
