Payments giant Visa is joining the Global Dollar Network (USDG), a stablecoin consortium led by Paxos, joining firms like Robinhood and Kraken in a push toward regulated, yield-sharing digital dollars.
Background
- Visa is set to become the first traditional finance institution to join the Global Dollar Network (USDG), a stablecoin initiative spearheaded by Paxos, according to CoinDesk citing sources familiar with the matter.
- The consortium already includes major crypto and fintech players like Robinhood, Kraken, Galaxy Digital, Bullish, Anchorage Digital, and payments processor Nuvei.
- The group is working to build an interoperable stablecoin ecosystem that differentiates itself from dominant players like Tether and Circle by offering shared yield with ecosystem participants.
- USDG aims to rethink stablecoin design by enabling network participants (such as wallets, exchanges, and other financial apps) to earn a share of the interest generated from reserves, rather than having it all retained by the issuer.
- This model is seen as more collaborative and potentially appealing to traditional players looking to tap into stablecoin-based financial infrastructure.
Why Should You Pay Attention?
- Visa's entry into the USDG consortium marks a significant moment in the convergence of traditional finance and the crypto sector.
- It signals growing institutional interest in not just integrating with stablecoins, but shaping the future of digital dollar infrastructure.
- Given Visa’s global reach and its prior crypto collaborations, its involvement could fast-track adoption and legitimacy of USDG in mainstream finance.
Who Said What?
- Though Visa has not officially confirmed its membership, sources close to the matter told multiple CoinDesk that the payments giant is preparing to participate.
- A person familiar with the consortium’s structure noted that Visa would be “the first legacy payment network to join,” potentially acting as a key connectivity layer for consumer adoption and global liquidity.
Zooming Out
- Stablecoins are emerging as a core financial primitive in both decentralized finance (DeFi) and institutional applications, with a global market cap exceeding $150 billion.
- While Tether and Circle have historically dominated the space, newer models like USDG are beginning to challenge this duopoly by offering revenue-sharing models and compliance-focused architecture.
- Visa’s inclusion in USDG could be a pivotal moment for broader adoption of programmable money, especially as regulators warm to asset-backed stablecoins.
- With Paxos operating under regulatory oversight in the U.S., the consortium may also enjoy a more favorable compliance posture.
