Visa Steps into Stablecoin Arena, Joins Paxos-Led Global Dollar Network

Singapore – Payment processing giant Visa (V) is making a significant foray into the stablecoin ecosystem by joining the Global Dollar Network (USDG), a consortium spearheaded by Paxos, CoinDesk reported on Monday, citing two sources close to the matter.

This move positions Visa as the first traditional financial institution to become part of USDG, which already includes major players in the crypto and fintech sectors such as Robinhood, Kraken, Galaxy Digital, Anchorage Digital, Bullish, and Nuvei.

The formation of USDG represents a novel approach to the stablecoin business, which has been largely dominated by Tether's USDT and Circle's USDC. Unlike Tether, which retains the interest earned on its stablecoin reserves, USDG is designed to share the generated yield with participating firms that contribute to the network's connectivity and liquidity. This shared yield model aims to incentivize broader adoption and integration of the stablecoin within various platforms and applications.

Stablecoins , cryptocurrencies pegged to a stable asset like the U.S. dollar, offer the benefits of blockchain technology – such as faster and potentially cheaper transactions – with the price stability of fiat currencies. This makes them attractive for a wide range of use cases, including payments, remittances, and as a stable store of value within the often-volatile crypto market.

The move also highlights the increasing engagement of major card networks with the crypto ecosystem. Visa has also been exploring collaborations with Sam Altman's World Network. Similarly, Mastercard has been actively involved in the space, notably partnering with the non-custodial wallet MetaMask .