A New Chapter in the Development of Stablecoins: Insights and Strategic Layout from Visa

Recently, the U.S. Senate passed the "Guidance and Establishment of the U.S. Stablecoin National Innovation Act" (, referred to as the "GENIUS Act" ), marking a clearer regulatory framework for stablecoins in the United States. Visa's Chief Strategy and Product Officer Jack Forestell subsequently published an article explaining Visa's views on the future development of stablecoins. This aligns with the views of Visa CEO Ryan McInerney during an interview.

As a leader in the traditional payment sector, Visa has unique insights into the direction of the payment industry. This article will summarize Visa's viewpoints and, along with related thoughts, explore the development prospects of stablecoins.

1. Important Moments in the History of Payment

Forestell believes that the "GENIUS Act" could become an important milestone in the history of payments. While stablecoins represent an opportunity in the era of programmable digital currencies, a significant amount of work is still needed to achieve scalable applications.

McInerney stated that Visa has been preparing for stablecoins, anticipating the arrival of the stablecoin era. The promotion of new payment technologies requires all parties to establish broad trust, which takes time to accumulate and relies on a series of complex interrelated functions to achieve goals such as security, reliability, and fraud prevention.

Stablecoins need to be implemented on three levels to become the next generation of digital payment infrastructure:

1. Technical Layer: Requires a strong, scalable, flexible, and open technological backbone that can securely and reliably execute large-scale transactions.

2. Reserve Layer: Trust must be established in the value and stability of the medium of exchange. Regulated, reserve-backed stablecoins provide a solution for this.

3. Interface Layer: A ubiquitous interface layer is needed to provide participants with trust, rules, standards, security, and value, covering billions of end users and offering a convenient value exchange mechanism.

The stablecoin infrastructure itself cannot solve the interface layer issues. If these issues cannot be resolved, stablecoins will struggle to achieve widespread adoption.

2. Visa's Strategic Layout

Visa has built the world's largest and most secure payment system. Through continuous investment, Visa enhances the compatibility of its payment system with underlying transaction mediums, allowing all parties to easily integrate into the Visa ecosystem.

Visa integrates its powerful payment infrastructure, services, and connectivity into the "Visa as a Service" technology stack, providing a seamless and secure digital payment experience for billions of users worldwide. From small sellers to large banks and enterprises, they all choose the Visa technology stack to expand their payment solutions.

Since 2020, Visa has facilitated nearly $95 billion in cryptocurrency purchases and over $25 billion in cryptocurrency spending, totaling over $100 billion in funds flow. There are 4.8 billion Visa cards and nearly 14 billion Visa digital tokens globally, regarded as the best payment method.

With the capability of Visa, users do not need to consider whether the merchant accepts it, whether a special wallet is required, whether the correct currency is in the wallet, or how much the gas fees are when making a payment. Visa can provide users with a convenient, secure, and privacy-protected payment experience.

3. Application Scenarios of Stablecoins

Forestell pointed out that stablecoins have found a niche in the cryptocurrency trading market and there are significant opportunities in emerging markets, particularly:

• Users in small coin markets, high inflation, and foreign exchange control countries hope to hold US dollars but find it difficult to obtain them.
• Certain cross-border capital flow scenarios, such as remittances between individuals or payments between enterprises.

Tether CEO stated that over 60% of the market capitalization growth of USDT comes from grassroots usage in emerging markets. The next growth driver may come from commodity trading.

Visa views these as new processes that are not yet fully resolved, providing opportunities for business growth. Visa plans to collaborate with stablecoin-native partners, platforms, and financial institutions to fully leverage the capabilities of the Visa technology stack.

In developed markets like the United States, it is still unclear whether consumers and businesses are willing to use stablecoins for payment, as there are already numerous competitive options.

The "GENIUS Act" brings regulatory clarity to stablecoins, paving the way for further applications. Visa is actively developing various solutions in the stablecoin space, including:

• Deploy Visa credentials and digital tokens, connecting stablecoin platforms with fiat currency networks
• Provide local stablecoin settlement
• Cross-border capital flow solutions through stablecoin infrastructure
• Provide clients with programmable currency solutions

Stablecoins need time to truly become "genius", but this process has already begun.