Visa Study Shows 90% of Stablecoin Transactions are Non-User

As a crypto investor with several years of experience in this volatile market, I’ve learned to take news like this with a grain of salt. The latest report from Visa about stablecoin transactions not being widely used for payments is a reminder that the true value and adoption of cryptocurrencies can be elusive.

As a crypto investor, I’ve recently come across an intriguing finding by Visa Inc. About 90% of stablecoin transactions, in their assessment, may not originate from actual users. This suggests that the widespread use of these digital tokens for everyday transactions is yet to materialize.

In collaboration with Allium Labs, Visa developed a tool that separates human-made transactions from bots and large traders, leaving behind the $149 billion worth of authentic payments, among the total $2.2 trillion processed in April.

As a crypto investor, I’ve been following the buzz around stablecoins and their potential to disrupt the $150 trillion payments industry. However, recent challenges to this notion have made me question if these digital assets, which are pegged to traditional currencies like the dollar, are truly prepared for such a revolution.

Among the fintech giants like PayPal and Stripe, who are venturing into stablecoins, there is ongoing effort to enhance their usability and dependability for users.

Pranav Sood, Airwallex’s EMEA head of the executive management team, expressed his viewpoint on stablecoins: “They may hold great promise for the long term. However, our immediate and medium-term priorities should be geared towards enhancing the performance of existing financial systems.”

It can be challenging to grasp the real worth of cryptocurrency transactions. For instance, according to Glassnode’s assessment during the 2021 cryptocurrency surge, the reported $3 trillion circulating market value might have been nearer to $875 billion in actuality.

As a crypto investor, I’ve come across an issue that can lead to some confusion with stablecoins: double-counting transactions. Let me explain what I mean by that.

With a staggering volume of over $12 trillion in transactions processed last year, Visa holds a significant position in the financial industry. However, this dominance could be challenged if stablecoins gain widespread acceptance. Analysts forecast that the value of these digital currencies could reach an impressive $2.8 trillion by 2028. Nevertheless, there remains uncertainty among users and businesses regarding their user-friendliness.

Sood pointed out, “Overcoming this hurdle is truly substantial. Keep in mind that approximately 40-60% of business transactions in the US are still being processed through checks. This information provides a clear picture of the current technological acceptance level within the market.”

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2024-05-06 14:13