Visa Expands Stablecoin Capabilities

The global payments giant announced plans to add support for four stablecoins running on four unique blockchains. McInerney explained that these stablecoins represent two major digital currencies that Visa can process and convert into more than 25 fiat currencies.

“We are adding support for four stablecoins running on four unique blockchains, representing two currencies that we can accept and convert to over 25 traditional fiat currencies,” said Visa CEO Ryan McInerney.

Visa already supports USDC, EURC, PYUSD, and USDG on Ethereum, Solana, Stellar, and Avalanche networks. The expansion reinforces Visa’s leadership in integrating blockchain technology into global payment systems.

Stablecoin Transactions Hit Record Growth

According to McInerney, Visa has facilitated over $140 billion in crypto and stablecoin flows since 2020. The company has seen “significant momentum” in this sector as consumer spending through stablecoin-linked cards quadrupled compared to last year.
Monthly transaction volume has now surpassed $2.5 billion, underscoring Visa’s growing impact in bridging traditional finance and decentralized payments.

Banks Can Issue Their Own Stablecoins

Visa is giving banks and financial institutions the tools to mint and burn their own stablecoins. McInerney said this is part of the company’s next development phase on its tokenized asset platform. Through Visa Direct, cross-border transactions will become faster and more transparent. This move is expected to boost stablecoin adoption and accelerate financial integration worldwide.

Visa is also expanding its pilot program that enables pre-funded cross-border payments using USDC and EURC, laying the groundwork for scalable blockchain-based payment infrastructure.

Key Takeaways

• Visa adds four new stablecoins across four blockchains.

• Banks can issue and burn stablecoins via Visa’s tokenized asset platform.

• Stablecoin-linked spending has quadrupled year-over-year.

• Monthly stablecoin volume exceeds $2.5 billion.

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As more real-world assets like real estate and securities move to blockchain technology, there’s a rising demand to incorporate different forms of cash for trading on these networks. Cuy Sheffield, Visa’s head of crypto, sees this as a significant opportunity for banks to issue fiat-backed tokens on blockchains in a regulated manner. This would allow customers to participate in on-chain capital markets. Visa has observed central banks exploring tokenization to modernize financial infrastructures, and its involvement in CBDC pilots in Hong Kong and Brazil underscores this trend.

Banco Bilbao Vizcaya Argentaria (BBVA), based in Spain, has been testing Visa’s Tokenized Asset Platform (VTAP) sandbox. BBVA aims to launch a pilot program in 2025 on the Ethereum blockchain, testing the issuance and transfer of bank tokens.

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Visa executives noted that the next wave of innovation may come from banks developing their own products for real-time transactions and cross-border transfers. While fintechs like PayPal and asset managers such as BlackRock and Franklin Templeton have made strides in blockchain and stablecoin technology, banks are just beginning to experiment with tokenization.

Visa aims to help overcome regulatory and technological fragmentation, possibly creating standards to ensure interoperability between financial institutions working with tokenized assets. These advancements could pave the way for banks to develop more liquidity and explore structured financial products using smart contracts.

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The report, prepared in collaboration with Visa and data firm Allium Labs, introduced a new metric that measures “organic payment activity” by filtering out bots and large-scale merchants. According to this metric, less than 10% of stablecoin transactions in April were deemed to have been initiated by individuals.

This finding challenges the narrative of widespread adoption of stablecoins, especially in regions where users seek refuge from inflation and capital controls. Despite this, stablecoins like Tether and Circle’s USDC have attracted significant interest, with Tether alone generating $4.5 billion in profits in the first quarter of the year.

But some experts question the validity of Visa’s approach. Austin Campbell, an assistant professor at Columbia Business School, criticizes Visa’s focus on excluding commercial activities from its analysis. He argues that trading is a fundamental aspect of crypto usage and suggests that Visa’s narrow view may not fully capture the benefit of stablecoins.

Additionally, the report’s methodology, which excludes transactions from accounts with more than 1,000 stablecoin transactions and more than $10 million in transfer volume, may miss legitimate use cases, such as transactions involving centralized exchanges such as Binance and Coinbase.

While Visa’s interest in understanding stablecoin adoption is understandable given its position as a payments company, critics like Campbell suggest the company’s perspective may be too limited. Understanding the broader ecosystem of stablecoin usage, including trading activities and exchange-based transactions, is crucial to a comprehensive understanding of its impacts.

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