TORONTO — Shopify will let people pay in stablecoins for purchases at its merchants’ online stores, joining a coalition of companies pushing crypto into more real-world transactions. 

Here’s what you need to know:

The order: Merchants that use Shopify’s commerce platform will be able to take payments in USDC, a stablecoin pegged to the U.S. dollar, CEO Tobi Lütke announced at Coinbase’s conference in New York on Thursday. Store owners can cash out in local currencies, so they don’t have to hold crypto themselves. 

The feature is currently in limited release and will roll out to more merchants later in the year, when it will be “default on,” Lütke said. It will be part of Shop Pay, the Ottawa-based firm’s consumer-facing checkout service, and part of Shopify Payments, its revenue-spinning processing business. To help popularize stablecoin purchases, Shopify plans to give shoppers a one per cent cash back incentive for USDC payments—the same reward it offers for buying via Shop Pay.

Shopify’s clients could already accept Bitcoin, Ethereum and other popular tokens via an existing integration with Coinbase. But Lütke said stablecoins make more sense for shopping. Online stores’ sales suffer when consumers are worried they’ll “end up with huge regrets” because they bought something with Bitcoin and then the value of the cryptocurrency rose, Lütke said.

“For the first time, this is a large-scale e-commerce platform adopting crypto payments,” Coinbase CEO Brian Armstrong said. 

The tech: Shopify’s new stablecoin offering is powered by Stripe and Coinbase. The USDC stablecoin is issued by Circle, a Coinbase portfolio company. USDC is currently the only stablecoin that Canadian crypto platforms are allowed to offer.

The alliance: Shopify has close ties to both firms it’s using to facilitate stablecoin transactions. Stripe has long provided core technology for Shopify Payments, and the Canadian commerce company is a significant investor in the San Francisco-based fintech firm.  

Lütke has been on the board of Coinbase since January 2022. He and Armstrong have been consulting annually on whether crypto was ready to enter the shopping world, both CEOs said on stage Thursday. Now, they agree it is. 

“In our own philosophical framework, we are extremely aligned with everything that crypto stands for,” Lütke said.

Stablecoins under scrutiny: Stablecoins are crypto assets whose value is pegged to that of another asset outside the crypto world, typically the U.S. dollar. They’re systemically important to crypto markets, playing a key role in blockchain-based decentralized finance and facilitating trading between various tokens on cryptocurrency-trading platforms. Policymakers are grappling with how to address what has become a US$255 billion industry, since stablecoins aren’t always as stable as their name suggests. The collapse of the stablecoin TerraUSD sparked a massive crypto price crash and related contagion in the summer of 2022.

Crypto world to real world: Stablecoins can also be used to make consumer payments without a bank account, which some have suggested could promote financial inclusion in emerging economies. Regulators have concerns about that, too, quashing Meta Platforms’ proposed Diem stablecoin in 2022 over worries about the wisdom of granting a tech company power over a global payment instrument. Shopify and Stripe were part of the initial coalition behind the Diem project.

Shopify’s announcement is part of a recent resurgence of the concept. In February, Stripe closed a US$1.1 billion acquisition of stablecoin infrastructure firm Bridge. In April, Bridge announced a partnership to offer cards in Latin America that would let customers make payments with stablecoins anywhere Visa is accepted, broadening access to the payment method.

“It’s an incredible confluence of pieces of infrastructure, vibes, regulatory changes, all coming together,” Lütke said, speaking shortly after U.S. President Donald Trump promised the audience his administration would support the crypto sector.