Understanding Stablecoin Payments: A Technical Guide

Stablecoins have become the backbone of crypto payments. Let’s explore how they work from a technical perspective.

What Are Stablecoins?

Stablecoins are cryptocurrencies designed to maintain a stable value, typically pegged 1:1 to the US dollar. The most popular ones are:

Token	Issuer	Market Cap	Primary Chains
USDT	Tether	~$90B	Tron, Ethereum
USDC	Circle	~$25B	Ethereum, Solana
DAI	MakerDAO	~$5B	Ethereum

How Token Transfers Work

Stablecoins are ERC-20 tokens (or equivalent standards on other chains). When a customer pays:

1. They approve the transfer from their wallet
2. The token contract’s transfer function is called
3. The blockchain updates the balance mapping
4. Your monitoring system detects the incoming transfer

// Simplified ERC-20 transfer
function transfer(address to, uint256 amount) public returns (bool) {
    balances[msg.sender] -= amount;
    balances[to] += amount;
    emit Transfer(msg.sender, to, amount);
    return true;
}

Confirmation Times

Different chains have different finality characteristics:

• Ethereum: 12-15 seconds per block, recommend 12 confirmations (~3 min)
• Polygon: 2 seconds per block, recommend 128 confirmations (~4 min)
• Tron: 3 seconds per block, recommend 20 confirmations (~1 min)
• Solana: 400ms per slot, single confirmation is usually sufficient

PayIn handles all of this automatically. We monitor the mempool, track confirmations, and notify you when payments are safe to fulfill.

Address Management

For payment processing, you need a pool of receiving addresses. PayIn uses HD (Hierarchical Deterministic) wallets:

Master Key
    └── Account 0
        └── Address 0: 0xabc... (Order #1)
        └── Address 1: 0xdef... (Order #2)
        └── Address 2: 0x123... (User deposits)

This allows you to:

• Generate unlimited addresses from a single seed
• Track which address received which payment
• Maintain full custody of all funds

Handling Edge Cases

Real-world payments have edge cases:

Underpayments

Customer sends $99.50 instead of $100. Options:

• Accept it (good UX, you absorb the loss)
• Reject it (bad UX, customer must resend)
• Request the difference (middle ground)

Overpayments

Customer sends $150 instead of $100. Options:

• Credit the extra to their account
• Refund the difference
• Keep it (not recommended)

Late Payments

Payment arrives after the order expires:

• Auto-refund to the sender
• Credit to customer account
• Manual review queue

PayIn provides configurable policies for all of these scenarios.

Security Considerations

When accepting crypto payments:

1. Validate amounts precisely: Use BigInt, not floats
2. Check token contract addresses: Fake tokens exist
3. Wait for confirmations: Don’t ship on 0-conf
4. Monitor for reorgs: Especially on PoW chains

Next Steps

Ready to integrate? Check out:

• Quick Start Guide
• API Reference
• Example Integrations