Visa Launches Stablecoin Platform, Coinbase Slides 4%+ After Hours

In a move announced July 16, payments giant Visa unveiled the Visa Stablecoin Platform, an internal system designed to help banks and fintechs integrate stablecoins into their existing Visa payment and treasury workflows. The platform will initially focus on OUSD, a stablecoin launched two weeks ago by the Open Standard consortium of financial heavyweights. The news weighed on Coinbase (COIN) shares in after-hours trading. As of 6:00 PM ET on July 16, Coinbase stood at $160.49, down 4.02% from its prior close of $167.21, after touching an intraday low of $159.51.^[Fortune]

Visa’s Stablecoin Platform: A One-Stop Integration

Visa’s new platform aims to make stablecoins easier to use for roughly 15,000 financial institutions and over 200 million merchants. “This is less about enabling stablecoins and more about… making them interoperable with customers’ settlement flows, treasury workflows, and existing banking setups,” Rubail Birwadker, Visa’s head of global growth, told Fortune.^[Fortune]

For merchants, stablecoins offer near-instant settlement at minimal cost, while blockchain transfers provide a clear, nearly immutable record. Visa, which processes roughly $15 trillion in payments annually and has already settled billions of dollars in stablecoin transactions, hopes to scale that volume by simplifying stablecoin access.^[Fortune]

OUSD at the Core, Multiple Giants on Board

The platform’s strategic anchor is OUSD, a stablecoin announced two weeks ago by the Open Standard consortium, of which Visa is a partner. Visa sees OUSD as a way to expand its stablecoin offerings alongside existing assets like Circle’s USDC and Paxos’ USDG.^[Fortune]

Visa isn’t the only payments processor eyeing stablecoin potential. Rivals American Express and Mastercard have also partnered with Open Standard to launch OUSD. Last month, Mastercard introduced stablecoins as a new way for banks and payment companies to settle card transactions, starting with six regulated, dollar-backed assets. Mastercard’s broader stablecoin strategy leans heavily on partnerships.^[Fortune]

Market Reaction: Coinbase Under Pressure After Hours

While Visa’s stablecoin platform is seen as a major step for the payments industry, crypto exchange Coinbase felt the heat in after-hours trading. As of 6:00 PM ET on July 16, Coinbase traded at $160.49, down 4.02% from its prior close, with an intraday low of $159.51. The market broadly interpreted the move as traditional payments giants charging into stablecoins, potentially intensifying competition and pressuring pure-play crypto platforms like Coinbase.^[Fortune]

Industry Backdrop: Stablecoin Market Expands

The stablecoin market has grown exponentially over the past year, pushing mainstream payment networks to adapt. Visa became the first payments network to settle transactions in USDC in March 2020 and launched a stablecoin settlement program last December — a first for a major global payments company. Birwadker said the Visa Stablecoin Platform will serve as an umbrella for all of Visa’s existing stablecoin services.^[Fortune]

Meanwhile, other stablecoin projects have seen turbulence. Cap Labs’ cUSD faced controversy after a “stabledrop” program change, forcing founder Benjamin Peillard to defend the company’s actions and distance it from a wallet address accused of receiving preferential treatment. cUSD’s market cap has fallen from a peak of over $400 million in late January to roughly $62 million today.^[Protos]

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