Payment authorization is the approval that permits a payment instruction or transfer to proceed under the rules of the relevant account, wallet, or payment system.
In a self-custodial stablecoin wallet, authorization normally involves a valid digital signature or smart-contract permission. In a custodial service, the provider can authenticate the customer and execute the blockchain transaction on the customer's behalf. Programmable arrangements can also rely on preauthorized spending limits, multisignature approval, or rules that allow future payments within specified conditions.
Authorization approves the payment instruction. Authentication establishes that the person, device, or credential requesting the action is entitled to do so.
Authorization design determines who can move funds, what limits apply, and how recurring or automated stablecoin payments can operate safely.
A user can sign a stablecoin transfer directly or grant a smart contract a limited allowance that permits later payments up to a specified amount.