# What Are Recurring Crypto Payments, and How Do They Work?

> What recurring crypto payments are, why wallets can only push payments, how smart contracts handle repeat payments, and who uses them for subscriptions, payroll and DCA.

Published: 2026-11-10 · Papaya Finance Limited · Canonical: https://papaya.finance/blog/what-are-recurring-crypto-payments

Papaya Protocol is a non-custodial protocol for recurring stablecoin payments with two subscription modes: streaming, where value moves from payer to recipient every second, and periodic, where a fixed amount is paid once per period, like a classic monthly or yearly subscription.

**Short answer:** Recurring crypto payments are payments in a crypto asset, usually a stablecoin such as USDC or USDT, that the payer sets up once and that then repeat each period or flow every second until the payer cancels. A plain wallet can't do this, because every transfer needs the owner's signature. A smart contract fills the gap: the payer authorizes it once, and the contract's rules move value from the payer's balance to the recipient's.

> **Definition — Recurring crypto payment**
>
> A payment in a crypto asset, most often a stablecoin, that repeats or continues under terms the payer approved once, with no new signature for each payment, until the payer cancels.

## The push vs pull problem in wallets

In banking, a recurring payment works because the bank or card network can debit your account once a mandate exists. Crypto has no such middleman.

Every normal crypto transfer is a push payment. The owner signs a transaction and sends funds out, and nobody else can move those funds. So a wallet can't wake up on the first of the month and pay a bill by itself.

In a pull payment, the recipient or a contract acting for them takes funds under a permission the payer granted earlier, the way card billing works. On EVM networks the closest building block is the ERC-20 allowance, which lets a contract move tokens up to a limit (more in [what is a token allowance](https://papaya.finance/blog/what-is-a-token-allowance), and in the [ERC-20 standard on ethereum.org](https://ethereum.org/en/developers/docs/standards/tokens/erc-20/)).

An allowance alone still needs somebody to send a transaction for each charge. We covered the basic options in [can you set up recurring payments with crypto](https://papaya.finance/blog/can-you-set-up-recurring-crypto-payments).

## How smart-contract recurring payments work

With Papaya Protocol, the payer deposits stablecoins into a smart contract and keeps a balance there. Each contract works with one stablecoin on one network, for example USDC on Base. The payer subscribes once to a recipient, and the contract records how much they pay and to whom.

The contract doesn't send a transaction every period, and no server goes through subscribers one by one. Each account stores its last balance, its incoming and outgoing rates and the time of the last update, and the current balance is calculated from those ([how it works](https://docs.papaya.finance/overview/how-it-works)). So the cost of a subscription does not grow with the number of billing periods, and the recipient withdraws what has accrued whenever they want.

## Two ways to repeat a payment

For a short glossary of these terms, see [what is a recurring stablecoin payment](https://papaya.finance/blog/what-is-a-recurring-stablecoin-payment). Papaya Protocol has two modes with the same balance model and no transaction per period, deployed as separate contracts ([subscription modes](https://docs.papaya.finance/overview/subscription-modes)).

## Per-second streaming

In streaming mode, a subscription has a rate, an amount per second. The payer's balance goes down and the recipient's balance goes up every second from the moment they subscribe. Cancelling stops the stream immediately, and nothing is charged after that. To start, the payer needs about two days of payments in their balance. On security, the per-second streaming version is audited by Stronghold Security (April 2024).

## Periodic

In periodic mode, a subscription has a fixed amount per period, for example 10 USDC per month. The first period is paid when the user subscribes. At the start of each following period, the contract deducts the period amount from the payer's balance, with no new signature. If the user cancels, the current period is not refunded and the subscription ends when the paid period ends. To start, the payer needs one full period plus a small reserve.

| **Question**            | **Streaming**               | **Periodic**                                                   |
|-------------------------|-----------------------------|----------------------------------------------------------------|
| What is charged         | An amount per second        | A fixed amount per period, such as monthly                     |
| First payment           | Starts accruing immediately | Full first period paid at subscription                         |
| Cancellation            | Stops immediately           | Current period is not refunded; ends when the paid period ends |
| Balance needed to start | About two days of payments  | One full period plus a small reserve                           |
| Transactions per period | None                        | None                                                           |

To choose between them, read [streaming vs periodic subscriptions](https://papaya.finance/blog/streaming-vs-periodic-subscriptions).

## Who uses recurring crypto payments

## Subscriptions

A software product or a membership can charge a monthly plan with periodic mode, or charge for the exact time used with streaming. If the recipient is a smart contract, Papaya notifies it when a subscription is created or cancelled, so access can follow in code.

## Payroll and contractors

A company can stream pay to a single person, and an employer can also fund someone's balance with `depositFor`. The worker withdraws when they want. Labor law and taxes vary by country, so check local rules before paying salaries or contractors in stablecoins.

## DCA purchases

Dollar-cost averaging means buying an asset with a fixed amount at regular intervals. With Papaya, the funding stream costs the same whether purchases happen monthly or hourly ([use cases](https://docs.papaya.finance/overview/use-cases)). The buying is done by a separate service, such as a wallet's DCA feature (see [recurring buys for wallets](https://papaya.finance/blog/recurring-buys-dca-for-wallets)). DCA is a method of buying and promises no particular result.

## Who controls the money

The payer grants a spending permission and can revoke it at any time. Papaya Finance Limited never takes custody of user funds. Balances sit in a non-custodial, non-upgradeable smart contract. Neither Papaya Finance Limited nor the contract owner has any special power to move or freeze them; funds move only under the contract's public rules: the user withdraws their own balance, merchants withdraw what has accrued to them, and an underfunded account can be refilled or liquidated (details: [balance refill and liquidation](https://docs.papaya.finance/overview/balance-refill-and-liquidation)).

Both modes run on the same supported EVM chains: Ethereum, BNB Chain, Polygon, Base, Scroll, Sei, Avalanche, Arbitrum, zkSync, and Arc. Available stablecoins depend on the network ([supported networks](https://docs.papaya.finance/overview/supported-networks)). Actions such as subscribing or withdrawing need a transaction, and gas costs depend on the network and its current conditions.

## Further reading

- [Can you set up recurring payments with crypto?](https://papaya.finance/blog/can-you-set-up-recurring-crypto-payments)

- [What is a recurring stablecoin payment?](https://papaya.finance/blog/what-is-a-recurring-stablecoin-payment)

- [How do you cancel a crypto subscription?](https://papaya.finance/blog/how-to-cancel-a-crypto-subscription)

- Docs: [how it works](https://docs.papaya.finance/overview/how-it-works), [subscription modes](https://docs.papaya.finance/overview/subscription-modes)

## FAQ

### Can a crypto wallet make recurring payments on its own?

No. A wallet only sends a payment when its owner signs it, so recurring payments need a smart contract the payer authorizes once.

### Do I have to approve every payment?

No. You subscribe once, and the contract's rules handle each period or second until you cancel.

### What is the difference between streaming and periodic payments?

Streaming charges per second and stops the moment you cancel. Periodic charges a fixed amount per period and ends when the paid period ends.

### Can recurring crypto payments be used for salaries?

A company can stream pay to one person or fund their balance. Labor law and taxes vary by country.

### Does Papaya hold my funds?

No. Balances sit in a non-custodial smart contract, and you can withdraw your available balance at any time.

*Nothing in this article is investment advice.*

*This article is for general information and is not tax, legal or accounting advice.*