Rising Stablecoins Volume: A Threat to Visa? Analyzing Crypto Coins like USDT and DAI

• Recent analysis by Sacra Research suggests that the total transaction volume of stablecoins may soon exceed that of major payment processor Visa.
• Despite the potential advantages of stablecoins in international payments, concerns remain regarding the authenticity of these transactions.
• Visa’s cryptocurrency division head, Cuy Sheffield, points out that a significant portion of stablecoin transactions could be driven by bots rather than human users.

As stablecoins gain traction in the global payment landscape, their total transaction volume may soon surpass that of Visa. However, the authenticity of these transactions remains a contentious issue.

Advantages in International Payments

Jan-Erik Asplund, co-founder of Sacra Research, argues that stablecoins offer an optimal solution for international transactions. Unlike traditional banking systems, stablecoins allow for quick and cost-effective transfers without the constraints of business hours. This efficiency could potentially push their payment volume beyond the $4 trillion mark, overtaking established giants like Visa.

Concerns Over Genuine Usage

Despite the potential advantages of stablecoins, controversies persist regarding the authenticity of these transactions. Cuy Sheffield at Visa has raised concerns that a significant portion of stablecoin transactions could be driven by bots rather than human users. This skepticism is supported by recent findings from Visa, which suggest that nearly 90% of the stablecoin activities in the past month did not involve real users.

Key Insights for Stakeholders

• Stablecoins may revolutionize cross-border payments with their speed and lower costs.
• The adoption of stablecoins by major banks underscores their growing legitimacy and potential to integrate into mainstream finance.
• Stakeholders should consider the implications of automated transactions when evaluating the true growth and risks associated with stablecoins.

Conclusion

As the debate continues, Visa has partnered with Allium Labs to refine how stablecoin transactions are measured and reported. This initiative aims to filter out distortions caused by non-human activities, ensuring that future data reflects more accurate human engagement in stablecoin use. The outcome of these efforts could significantly influence the perception and valuation of stablecoins in the financial ecosystem.