Merchant accepts stablecoin directly at point of sale via payment processor integration.
"A customer approaching the register with their phone — wallet open, ready to scan and pay."
Consumer initiates payment from their wallet on Base. The merchant's POS terminal displays a QR code or NFC tag with the payment request (amount, recipient address, reference). L4 Account and L5 Application lit: the consumer's identity is policy-enforced at the wallet level. For custodial wallets (Coinbase), KYC has already been completed; for self-custodial wallets, identity may be thin.
"The payment processor's real-time authorization — like a card terminal dialing the bank, but the check happens against blockchain addresses instead of card numbers."
Coinbase Commerce (or BitPay, Flexa) screens the payment: sanctions check on both addresses, fraud scoring, merchant category validation. The processor may enforce geographic restrictions or velocity limits. L3 Execution lit — authorization is code-enforced. The processor bears the compliance obligation as a money transmitter or payment service provider.
"The funds clearing from the customer's account to the merchant's account — a single atomic transfer."
USDC transfers from consumer wallet to merchant wallet on Base. The payment processor may route through its own settlement contract for atomic receipt confirmation. L2 Consensus and L3 Execution lit. Tax obligations crystallize at this moment — the merchant has received income, sales tax calculations apply, and the processor may generate a 1099-K for US merchants above threshold.
"The merchant's register closes the sale — receipt printed, inventory updated, accounting entry recorded."
Merchant receives settlement confirmation. The payment processor provides the receipt with transaction details, exchange rate (if auto-converted to fiat), and tax-relevant metadata. L4 Account and L5 Application lit — reconciliation and reporting are policy-enforced. The merchant can hold USDC, auto-convert to fiat, or split between both.
Resolved 4 steps across 1 chain(s). 0 threshold(s) triggered. Frameworks: Common Reporting Standard / FATCA.
Coverage notes: 5 disclosed gap(s).