Over the past six months, I’ve transitioned from a Web3 observer to an insider in the payments industry. Now, I’ve chosen to pause—and step away from Web3 payments altogether. This isn’t a retreat after failure, but rather a strategic recalibration made after having truly entered the arena.
During these six months, I visited Yiwu, Shuibei, and Putian in China—and also traveled to Mexico—to see firsthand, in the very places most frequently cited in industry reports, how payments are actually built and operated on the ground. I rolled up my sleeves too: I built an MVP for a Web3 payment solution, integrated bank accounts, developed Web3收款 tools, and tried to walk—step by step—the entire imagined path from inception to execution.
Yet the deeper I went, the clearer one truth became: This isn’t an industry where “building a great product guarantees victory.” Payments aren’t won on features alone—they’re won on banking relationships, licenses, capital efficiency, and, above all, long-term risk management capability.
Many payment businesses that appear profitable aren’t actually earning a premium for superior capability—they’re earning a risk premium. Things simply haven’t gone wrong—yet. What ultimately determines how far a payment company can go isn’t how much it earns, but whether it can withstand—and survive—when risks finally become visible and material.
As a serial entrepreneur, six months ago a friend invited me to Hong Kong to co-found a startup focused on Web3 payments. At the time, I had little familiarity with Web3 itself—and even less foundational knowledge of the payments industry. All I saw from a macro perspective was an industry large enough in scale and still firmly in its upward growth cycle—and, importantly, one where Web3 and AI held tangible, underexplored synergies.
At that moment, this path appeared both genuinely problem-solving and Day 1 Global—a rare combination. I didn’t enter because of Web3 per se; I entered because, within the concrete context of payments, Web3 seemed to offer a structurally superior alternative—at least logically, it appeared capable of dislodging long-standing, persistent frictions that had been systematically overlooked.
Looking back now, however, I’ve gradually realized that, like many others, I’d unconsciously accepted a premise—one later repeatedly challenged by reality: If settlement efficiency is high enough, payments will naturally migrate on-chain. That idea was even further simplified into an intuitive assumption: Payments are just about matching transactions—so if you “get the flow working,” you can “hand-roll” cash flow.
When I first arrived in Hong Kong, my initial plan was refreshingly simple: Leverage my friend’s existing resources and relationships to start with OTC or relatively straightforward pay-in/pay-out use cases—get cash flow moving first, then let real-world demand guide what came next. But soon, the external environment accelerated dramatically. In May, the U.S. passed the GENIUS Act—and the entire industry ignited almost overnight.
Once I began operating on the front lines, my first move wasn’t to optimize the product—but to ask: Who is actually using Web3 payments? Why? And where? My first stop was Yiwu—the location most frequently highlighted in reports. What I found instead was a different picture: Stablecoins do exist there—but usage remains fragmented, relationship-driven, and largely hidden behind the scenes. No stable, scalable, mainstream adoption pathway has yet emerged.
From July to September, I systematically engaged potential customers. Their needs varied widely—but the core problem they all pointed to was strikingly consistent: Money must flow faster, cheaper, and more stably. Yet quickly, an unavoidable prerequisite surfaced: You must have a stable, compliant, and sustainable fiat ⇄ crypto on/off-ramp. We tried building our own ramp—but only after diving in did we realize: This isn’t a product challenge. It’s an infrastructure problem.
At its core, payments is a “water-flow” business. How much water you can handle depends on how much risk you can absorb; how long you can keep the water flowing depends on your resilience within regulatory, compliance, and risk-control frameworks. Payments is a good business—but it’s not the kind of business we are best equipped to excel at. This isn’t a rejection of the direction—it’s a respectful acknowledgment of our own resource endowments.
My decision to step away from Web3 payments isn’t rooted in bearishness toward the industry. Quite the opposite: Over these past six months, my conviction has only grown stronger—that structural opportunities in payments remain enormous. Cross-border payments aren’t a question of whether an explosion will happen—but rather an ongoing infrastructure rebuild, already well underway.
True, large-scale adoption of Web3 payments won’t occur at the user interface level. It won’t ignite because users suddenly start actively using wallets. Instead, it will emerge when enterprises upgrade their treasury systems, reconciliation workflows, cross-border settlement paths, and liquidity pool management—in the background. This is a “hidden” upgrade—one that hinges far more on system stability, regulatory certainty, and proven long-term operational reliability.
After deciding to exit payments, I didn’t leave the industry. Payments is merely the entry point; balances are the transit hub. The real scale and defensibility lie downstream—in fund management and asset allocation systems. If you trace the past two decades of China’s fintech evolution, this logic is unmistakable: Payments is the front door—not the destination.
[Yokiiiya]
Web3 Payments Reality Check: Beyond the Hype of Settlement Efficiency
The recent introspective piece from an entrepreneur who stepped away from Web3 payments after six months of intensive groundwork offers a sobering yet valuable perspective for the crypto market. This isn’t just another bearish take on Web3’s potential; rather, it represents a hard-won understanding of the structural barriers between blockchain’s theoretical advantages and real-world payment infrastructure.
Market Implications: Infrastructure Over Interface
The entrepreneur’s firsthand experience reveals a critical market reality: Web3 payments won’t scale through user-facing wallet adoption but through backend enterprise treasury system upgrades. This insight fundamentally reshapes our market expectations. The market has been overly focused on consumer-facing applications, while the real value capture will occur in the invisible infrastructure layer that handles cross-border settlement, liquidity management, and regulatory compliance.
This suggests a recalibration of token valuations—those projects solving the fundamental infrastructure problems (stable, compliant fiat-crypto ramps) or focusing on enterprise backend systems may deserve premium valuations compared to consumer-facing payment solutions. The market appears to be in a phase where understanding these nuances separates viable long-term plays from speculative ventures.
Token-Specific Analysis
The analysis doesn’t directly mention specific tokens, but we can infer several implications:
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Stablecoin Projects: While stablecoins exist in payment hubs like Yiwu, their fragmented, relationship-driven nature suggests projects focusing purely on stablecoin technology without addressing the underlying infrastructure challenges may face limited adoption.
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Cross-Border Settlement Tokens: Tokens that demonstrate real-world capability in handling cross-border flows with proper regulatory frameworks and banking relationships may outperform.
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Treasury Management Platforms: The entrepreneur’s insight that “the real scale and defensibility lie downstream—in fund management and asset allocation systems” suggests tokens enabling enterprise treasury management on blockchain could represent significant upside.
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DeFi Infrastructure: Projects building compliant fiat-crypto on/off-ramps may capture disproportionate value given the “unavoidable prerequisite” status identified by the author.
Risks Identified: The Hidden Barriers
The entrepreneur’s experience highlights several critical risks the market has underestimated:
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Regulatory Navigation Risk: Payments is fundamentally a compliance business, not just a technology one. Many crypto-native teams lack the sophisticated regulatory understanding required to navigate this landscape.
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Risk Management Capital Requirements: The “water-flow” nature of payments means businesses must absorb significant risk before scaling—a capital requirement that differs dramatically from most crypto business models.
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Banking Relationship Barriers: Web3 companies face an uphill battle establishing the traditional banking relationships that form the backbone of payment systems.
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Enterprise Adoption Timeline: The slow, deliberate pace of enterprise treasury system upgrades means we’re likely years away from meaningful backend adoption, regardless of technological superiority.
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Infrastructure-First Capital Requirements: Building the necessary infrastructure requires substantial capital and operational expertise that many crypto startups lack.
Opportunities: Where Real Value Will Be Created
Despite the sobering assessment, the entrepreneur remains bullish on structural opportunities. Key opportunities include:
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Enterprise Treasury Infrastructure: The backend systems that manage corporate payments, reconciliation, and liquidity represent a massive, underexplored opportunity for blockchain integration.
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Compliant On/Off-Ramp Infrastructure: The “unavoidable prerequisite” of stable fiat-crypto bridges suggests significant value will accrue to projects solving this challenge at scale.
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Cross-Border Settlement Solutions: The structural advantages of blockchain in cross-border payments remain compelling, especially as regulatory frameworks like the US GENIUS Act begin to form.
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Risk Management Protocols: Projects that can embed sophisticated risk management into blockchain infrastructure may capture significant value as payment businesses scale.
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Fund Management and Asset Allocation: The entrepreneur’s view that payments is merely “the entry point; balances are the transit hub” suggests the real opportunity lies in downstream financial services built on payment infrastructure.
Strategic Outlook
This analysis suggests we’re entering a more mature phase of Web3 payments development, where enterprise solutions and infrastructure will outperform consumer-facing applications. The market’s focus should shift from user acquisition to backend system integration, from flashy interfaces to invisible infrastructure.
The GENIUS Act mentioned in the article may represent an inflection point, providing regulatory clarity that enables the “hidden upgrade” of enterprise treasury systems. However, this will be a gradual process requiring patience from investors.
The entrepreneur’s decision to exit payments while remaining bullish on the broader industry reflects a sophisticated understanding of value capture in financial infrastructure. Payments, they correctly note, is the front door—not the destination. The real opportunities lie in the financial services that can be built upon this foundational infrastructure.
For investors, the lesson is clear: look beyond settlement efficiency narratives and focus on projects with viable paths to enterprise backend adoption, regulatory compliance, and sustainable risk management. The Web3 payments revolution won’t be televised—it will happen quietly in treasury departments worldwide.