One of the main disconnects with stablecoins is that consumers largely can’t spend them at checkout—an issue stablecoin-linked cards could potentially address.
But putting those cards into consumers’ hands creates another challenge: settlement. Stablecoins operate around the clock, leaving card issuers to manage daily settlement in a way that many startups aren’t equipped to manage. Visa, as a result, will make its settlement data and on-chain lending infrastructure available to blockchain lenders, giving them greater insight into the financial performance of the fintechs and neobanks issuing these cards.
That could make it easier for lenders to underwrite the companies behind the stablecoin-linked cards, speeding up the borrowing process and giving issuers more room to grow.
According to CNBC, Visa already facilitates more than 160 stablecoin-linked card programs, nearly 200% more than last year. New issuers are also joining the payments giant’s network each week.
Connecting All Entities
Visa has been active in digital assets for years, but like of its competitors, the company has ramped up its investments after the passage of the GENIUS Act in the U.S.
Most notably, the company unveiled its Visa Stablecoin Platform, a solution designed to give financial institutions a way to mint, facilitate, and settle stablecoins within their existing payment infrastructure.
The platform reflects Visa’s broader role in the digital asset ecosystem. While some financial services firms have issued stablecoins themselves, Visa has focused on building infrastructure that connects different parts of the ecosystem.
A Trickle-Down Effect
Although this strategy centers on the back end of the payments system, it could eventually affect how consumers use stablecoins.
Many stablecoin holders want to spend their digital dollars but struggle to find merchants that can accept them. This a significant obstacle to digital assets adoption, and a pain point that crypto cards—and especially stablecoin-linked cards—could help solve.
Instead of being linked to a bank account, stablecoin cards are attached to a wallet. These products can be used like conventional cards, with stablecoins instantly converted into dollars without any additional action required by merchants.
That capability is driving a surge in crypto card usage. According to Paymentscan, usage of these products hit an all-time monthly record of roughly $1.04 billion in July, a trend that was largely driven by stablecoins.
Notably, many of these purchases were for everyday expenses like groceries, gas, and ride-sharing services. The growing use of these cards suggests there is demand for a way to spend stablecoins in everyday transactions. And, Visa’s expansion of the infrastructure supporting them could help meet that demand.
