Problem
Every payout still needs USDC sitting in the right wallet at the right minute.
Cross-border payments have always worked by keeping cash sitting in the place the payment has to
land, so it can go out before the customer's money arrives. Banks call these accounts
nostro accounts, and the industry holds around $4 trillion in them.
Stablecoins remove the bank account. They do not remove the cash — the same balance now waits in a
wallet instead.
$4T
Cash the industry holds so payments can go out on time. After moving to stablecoins, the hard part
is no longer sending the money. It is having USDC ready in the wallet at the
moment a payout is due.
So Meridian keeps USDC waiting on 40+ payment routes — a route being one country to
another, such as the UAE to the Philippines. Each one is stocked for the busiest day that route has
ever had, so most of the money never moves. It earns nothing while it waits, and the treasury
already owns Bitcoin sitting unused right next to it.
Payout is due
Set route and time
Cash kept waiting
Stocked for the busiest day
Customer money arrives
Often earlier than needed
Nobody is charging a fee here. The cost is owning money that had to be available and was never spent.
Two versions of the same problem
It comes down to one question: when does the money have to be there?
Both cases ask the same thing — how do you fund a payout without leaving cash idle? The answer
depends on whether the dollars can be raised at the moment the payment goes out, or have to be
sitting in place well before it.
Funded at the moment of payout
Do not hold the cash at all
Where the payment can be delivered as soon as it is funded, Meridian only needs the dollars at
that instant. Keeping a standing balance serves no purpose. Borrow against Bitcoin the treasury
already owns, send the payout, and repay when the customer's money arrives.
Just-in-time funding
Borrow → send → repay
Funded in advance
Hold the cash, but stop it earning nothing
Where delivery runs through a local partner with its own capacity and cut-off times, the money
has to be in position hours or days ahead. Borrowing at the moment of payment is already too
late. That cash has to stay — but it can be lent out for one or three days and pulled back the
moment a payout needs it.
Pre-positioned funds
Lend → earn → recall
Solution
Loans with a fixed rate and a fixed end date, on both sides of the treasury.
On Morpho Midnight, the rate and the repayment date are both set when the loan is made, and every
loan is backed by assets the other side has pledged. Meridian borrows where a payout can be funded
the moment it goes out, and lends where the cash has to sit there anyway. Two briefs, one treasury.
Bitcoin is never sold to fund a payout. The treasury keeps it and borrows against it.
For educational purposes only. Not financial, investment, or legal advice.
Not all risks have been exhaustively studied.