FameEX Hot Topics | Could Stablecoin Transactions Surpass Visa This Quarter?

This quarter, stablecoins are on the brink of surpassing payment giant Visa in total payment volume, according to a blog post by Sacra co-founder Jan-Erik Asplund. Sacra, a research firm, suggests that the inherent advantages of stablecoins in cross-border transactions may enable their total payments volume to exceed Visa's, potentially reaching over $4 trillion.

Asplund points out the superior convenience, speed, and cost-efficiency of stablecoins. Unlike traditional systems that operate during business hours, stablecoins facilitate cross-border payments any day of the week and transactions complete in minutes rather than the usual 6 to 9 hours. Moreover, the cost of stablecoin transactions is significantly lower at $0.0037 compared to Visa's average of $12. Highlighting the growing adoption of stablecoins, Asplund notes, "Today every major bank is working on using stablecoins to run their payment rails behind the scenes." However, Visa’s head of crypto, Cuy Sheffield, challenges these claims. Sheffield criticizes the reliability of stablecoin data, highlighting that a large portion of on-chain transactions are inorganic, involving bots and automated programs, which he argues do not equate to traditional settlement processes. Visa's recently launched dashboard suggests that up to 90% of stablecoin transactions over the past 30 days may not involve genuine users.

In April, Visa reported a total stablecoin transaction volume of approximately $2.2 trillion. Nonetheless, the credit company classifies only about 10% of this, or $149 billion, as genuine. The rest is attributed to bots and automated transactions mainly from centralized exchanges.

To refine the accuracy of stablecoin transaction data, Visa collaborated with Allium Labs to create an adjusted stablecoin transaction metric, introduced in late April. This metric aims to exclude inorganic activities and other artificially inflated actions by applying two filters: a single directional volume filter that counts only the largest stablecoin amount transferred within a single transaction, and an inorganic user filter that excludes bot activity and automatic transactions from large entities like centralized exchanges.

Despite these concerns, the dashboard also reveals that the overall monthly volume of stablecoin transactions, regardless of their nature, has nearly doubled since early 2024, predominantly involving Tether. The exploration of stablecoin utility continues to expand within the payment industry. In 2023, PayPal introduced its PYUSD stablecoin, and in April, Stripe began allowing merchants to accept stablecoins for online payments. Ripple also announced its plan to launch a U.S. dollar-backed stablecoin, aiming to compete with the leaders in the market.

According to CoinGecko, the current market capitalization for stablecoins stands at around $161 billion, with a daily trading volume of $37 billion, indicating a robust and growing presence in the digital currency space.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.