Stablecoin Payments: Trust and Authorization with the Travel Rule

Stablecoin payments: building trust with authorization and the Travel Rule

Overview

Stablecoins promise simpler payments, so why do they make up only a tiny fraction of B2B payments? In this MERGE Madrid talk, Notabene explains what crypto rails are missing to integrate into the real economy: a pre-transaction authorization layer and context, and how the Travel Rule and its Notabene Flow platform help build that trust.

What you'll learn

• Why payments move information, not just value: the context needed to tie transactions to invoices and meet AML obligations
• The authorization step: why deciding before funds move is key to risk management
• The limit of crypto rails: unilateral, context-less transactions on a public blockchain
• The Travel Rule as a catalyst: exchanging originator and beneficiary information before or during the transaction
• Notabene Flow: addressless payments until authorization, global coverage and an open-source foundation (the TAP protocol)
• A concrete example: how an invoice is collected step by step with pre-transaction authorization

Session summary

How payments work today: it explains that payments move information as well as value (key to tying transactions to invoices and meeting anti-money-laundering obligations) and that an authorization step precedes settlement, letting institutions decide whether to proceed.

The limit of crypto rails: on a public blockchain, transactions are unilateral (whoever holds the keys decides) and lack context about the counterparty or the invoice; without context or authorization, it is hard to bring stablecoins into real payments, which today account for just 0.03% of B2B payments.

The Travel Rule as an opportunity: introduced for crypto in the FATF guidelines in 2019, it requires exchanging originator and beneficiary information before or in parallel with the transaction; it is presented not as a burden but as the catalyst to build the missing pre-transaction authorization layer.

Adoption and volume: it notes that most jurisdictions with material crypto activity already have or are passing Travel Rule regulation, and that Notabene's network has authorized over 1.5 trillion dollars in transactions with counterparty context.

The remaining challenge: according to its report, more than 60% of companies receive few or no transactions with the required Travel Rule information, and without pre-transaction authorization they cannot reject non-compliant deposits, leaving them exposed to their counterparty's willingness to comply.

Notabene Flow: it presents this open stablecoin payments platform, which turns pre-transaction authorization into a built-in feature: payments are “addressless” until checks are completed (there is no settlement address until both parties authorize), with coverage of more than 50 jurisdictional requirements and an open-source foundation on the TAP protocol (Transaction Authorization Protocol).

Practical example: using the case of a kitchen supplier collecting an invoice from a restaurant, it walks through the flow step by step (payment request, payment link, selection of agents, authorization by both parties and only then settlement), illustrating how settlement is prevented before authorization.

Watch the full talk

Watch the full recording on MERGE's YouTube channel, with Notabene on stablecoin payments, the Travel Rule and pre-transaction authorization.

FAQs

Why are stablecoins barely used in B2B payments?
Because crypto rails lack context and a pre-transaction authorization step: a blockchain transaction is unilateral and says nothing about the counterparty or the invoice, which makes it hard to use in real payments.

What is the Travel Rule?
It is the obligation, introduced for crypto by the FATF in 2019, to exchange originator and beneficiary information before or in parallel with the transaction.

What does a pre-transaction authorization layer add?
It lets institutions decide whether to accept a transaction before funds move, improving risk management and compliance.

What is Notabene Flow?
It is an open stablecoin payments platform that builds in pre-transaction authorization as a native feature (no settlement address until both parties authorize), with global coverage and an open-source foundation on the TAP protocol.