Key Points
- Visa is launching a pilot program to test stablecoins for international business payments.
- The move follows the passage of the “Genius Act,” a new U.S. law that regulates stablecoins.
- The program will enable businesses to use stablecoins to pre-fund their accounts, thereby facilitating faster transactions.
- This is a major sign of mainstream acceptance for stablecoins from a key financial industry player.
Payments giant Visa is launching a new pilot program that will enable businesses to use stablecoins for international payments. The move is a significant signal that these digital tokens are gaining acceptance in the mainstream financial world, particularly following the U.S. government’s recent passage of a landmark law to regulate them.
A Visa executive told Reuters that the new “Genius Act,” which sets clear rules for stablecoins, “changed everything” and made big institutions more comfortable with the technology. “Before that regulatory clarity, all the big institutions were sort of on the fence,” said Mark Nelsen, a product head at Visa.
The new pilot program will enable banks and other financial institutions to pre-fund their international payment accounts with stablecoins, rather than traditional currencies.
This could make cross-border transactions much faster and more efficient, freeing up cash that companies currently have to lock up in multiple currencies around the world.
While some have worried that stablecoins could disrupt traditional payment companies, Visa’s move indicates that some of the biggest players are choosing to adopt the technology rather than resist it. They view stablecoins not as a threat, but as a new tool to enhance their existing infrastructure. “It seems more likely just to incorporate stablecoin technology into existing flows,” Nelsen said.
Visa is already working with some unnamed partners on the pilot and plans to expand the program next year.
