Visa starts stablecoin platform for banks, fintechs and merchants

Visa has introduced a stablecoin platform aimed at making digital-dollar settlement easier for banks, fintechs and merchants in its network. The move matters because Visa already handles several billion dollars in stablecoin settlements and is trying to fold that activity into the payment systems its clients use today, according to Fortune.

The company said Thursday that the Visa Stablecoin Platform is an internal system for handling stablecoins inside existing Visa payment and treasury operations. Stablecoins are cryptocurrencies designed to keep a one-to-one value with the dollar by holding reserves.

Visa settles roughly $15 trillion in payments each year, Fortune reported. The company wants to expand stablecoin use across a network that includes about 15,000 financial institutions and more than 200 million merchants.

Rubail Birwadker, Visa’s global head of growth, told Fortune the product is focused less on access to stablecoins than on fitting them into treasury settlement, money movement and existing bank setups.

Why Visa is building around stablecoins

For merchants, stablecoins can allow transactions to settle immediately at very low cost, according to Fortune. Because stablecoin transfers happen on blockchains, they also create a visible transaction record that is difficult to alter.

Visa is positioning the platform as a way to reduce the technical work clients face when adding stablecoins to payment operations. Birwadker told Fortune that Visa wants customers to focus on the payment experience while the company handles the technical complexity behind it.

Birwadker said Visa has been bringing clients into stablecoin services for much of the past five years and described the new platform as the next step in that work.

OUSD will be the first focus

The platform will begin with OUSD, a new stablecoin announced two weeks ago by Open Standard, Fortune reported. Open Standard is a newly formed consortium of financial companies, and Visa is one of its partners.

Visa sees OUSD as a way to broaden the stablecoins it supports while adding to existing assets on its platform, including Circle’s USDC and Paxos’ USDG, according to Fortune.

Visa’s stablecoin push did not start with this launch. In March 2020, the company became the first payments network to settle transactions in USDC, Fortune reported. In December, it introduced a stablecoin settlement program that Fortune described as the first such program from a major global payments company.

Birwadker told Fortune the new Visa Stablecoin Platform will act as an umbrella for the company’s current stablecoin services.

Rivals are pursuing similar plans

Visa is not alone among major payments companies in expanding stablecoin services. Fortune reported that American Express and Mastercard have also partnered with Open Standard around OUSD.

Mastercard last month introduced stablecoins as a settlement option for banks and payment companies handling card transactions, beginning with six regulated dollar-backed assets, according to Fortune. Mastercard’s broader stablecoin strategy has centered on partnerships, including work with MoonPay and participation in Paxos’ Global Dollar network, so users can spend and receive stablecoins through Mastercard cards.

This story draws on original reporting from Fortune.