First, the short answer: there is no public data that shows the exact share of cashback subsidies in total stablecoin merchant payment volume. But based on fee structures and how projects operate, subsidy-driven transactions are likely much larger than natural spending.
To understand this, it helps to first look at the fee differences between stablecoin payments and traditional credit card payments.
Where Traditional Credit Card Cashback Comes From
When a merchant accepts a $100 credit card payment, it pays about $3 in fees. Most of that money—about $1.80—goes back to the consumer as cashback or points. The issuing bank gets about $0.45, the acquiring bank gets about $0.60, and Visa gets only about $0.15.
This system works like this: merchants bear the cost → banks use cashback to attract cardholders → consumers spend with cards → merchants keep bearing the cost. Cashback is the core fuel that keeps the system running, not an extra subsidy.
If stablecoin payments use pure on-chain channels, they can theoretically bypass this fee structure and lower merchant costs from 3% to 0.5% or even less. The problem is that lower costs do not automatically turn into real user payment habits.
Where Stablecoin Card Cashback Comes From
Stablecoin cashback cards on the market today can offer up to 6% cashback, far above the 1-2% typical of traditional cards. Where does that money come from? It mainly comes from a few sources:
Project marketing budgets: used to attract new users and create transaction volume data.
Yield from users' stablecoin deposits: for example, USDC deposits may earn 3.35-3.5% annualized returns, and part of that can be used to fund spending rewards.
Interchange fee channels through partner banks: if the card issuer has less than $10 billion in assets, it is not bound by the debit card interchange fee cap under the Durbin Amendment, so it can charge higher interchange fees to support cashback.
How Large Is the Subsidy-Driven Share of Transactions?
There are no official statistics, but we can look at it from three angles.
First, almost all leading projects use cashback as a core customer acquisition tool.
Coinbase Payments gives consumers 1% cashback and merchants 0.5% cashback. The MetaMask Card metal card gives 3% cashback. Rain's points system makes users who enable points spend 25% more per day than those who do not. Crypto cards can offer up to 6% cashback.
Second, some industry insiders say plainly that most stablecoin cards do not have real daily users.
One analyst's exact words: most of these new cards do not have real daily users, only behavioral subsidies—referrals, KOL (influencer) promotions, first-purchase rewards, cashback screenshots, and GMV data. This is not payment adoption; it is "adoption theater." The real test is user retention after subsidies disappear.
Third, regulators are already paying attention to this issue.
A U.S. banking group has called on regulators to ban cashback and discounts on stablecoin payments, arguing these rewards may be disguised interest prohibited by the GENIUS Act. Coinbase strongly opposes this, calling it "un-American." The dispute itself shows that cashback is not a small part of the stablecoin payment ecosystem.
Key warning: the merchant-pressure logic has not disappeared in the stablecoin world—it has just shifted to a different party. In the traditional card system, merchants bear 3% costs in exchange for consumer cashback. In the stablecoin card system, if merchants bear 0.5% costs but consumers receive 6% cashback, the gap has to be filled by project funding or token incentives. Once subsidies are removed, whether users still want to use the card is the real test of demand.
How to Check
If you want to judge whether a stablecoin card's transaction growth is supported by subsidies, check three things:
Whether the cashback rate is far above the industry average. If it is above 3%, it is most likely subsidy-driven.
User retention data. Look at the share of 30-day active users, not just signups.
When and how much the project raised in its latest funding round. If it is aggressively offering cashback right after raising money, that is typical "burn cash for growth."
How to verify: Look at the project's public data or social media. See whether users are posting "daily spending screenshots" or "cashback received screenshots." The higher the share of the first type, the larger the share of real adoption.
