Block-Backed Spiral Warns Bitcoin Is Losing Payments Race to Stablecoins

Block-backed Bitcoin development initiative Spiral warned that Bitcoin is losing ground to stablecoins in everyday payments despite seven years of technical upgrades. Although over one million U.S. merchants can accept Bitcoin via Square, routine consumer spending remains stubbornly weak due to price volatility, conversion friction, and U.S. tax treatment classifying purchases as taxable events. Meanwhile, stablecoins dominate emerging sectors, capturing an estimated 99% of first-quarter 2026 transactions on Coinbase's x402 protocol. In response, Spiral has issued a call for developer proposals to revive Bitcoin's adoption as a medium of exchange over the next five years.