Stablecoin

USDC

Rise

<p>A new metric co-developed by Visa Inc. indicates that over 90% of <a href="https://coingape.com/glossary/stable-coins/" target="_blank" rel="noopener">stablecoin</a> transaction volumes do not originate from authentic users. This suggests that these crypto tokens may still have a long way to go before becoming widely adopted as a means of payment.</p> 
<h3 id="bot-based-stablecoin-transactions-on-the-rise">Bot-based Stablecoin Transactions On The Rise</h3> 
<p>The dashboard developed by Visa and Allium Labs aims to filter out transactions initiated by bots and large-scale traders, focusing solely on those generated by genuine users. Out of a total of approximately $2.2 trillion in transactions recorded in April, only $149 billion were identified as originating from “organic payments activity,” according to Visa’s analysis.</p> 
<p>Visa’s findings challenge the assertions of stablecoin proponents who argue that these tokens, tied to assets like the dollar, are on the brink of revolutionizing the $150 trillion payments industry. Despite this, fintech giants such as <a href="https://coingape.com/singapores-triple-a-embraces-paypal-stablecoin-for-merchant-payments/" target="_blank" rel="noopener">PayPal Inc</a>. and Stripe Inc. are actively exploring stablecoins, with Stripe co-founder John Collison expressing optimism about the tokens in April, citing “technical improvements” as a driving factor. Commenting on the data, Pranav Sood, executive general manager for EMEA at payments platform Airwallex, <a rel="nofollow" href="https://www.bloomberg.com/news/articles/2024-05-05/more-than-90-of-stablecoin-transactions-aren-t-real-study-finds" target="_blank">said</a>:</p> 
<blockquote>
 <p>“It says that stablecoins are still in a very nascent moment in their evolution as a payment instrument. That’s not to say that they don’t have long-term potential, because I think they do. But the short-term and the mid-term focus needs to be on making sure that existing rails work much better.”</p>
</blockquote> 
<h3 id="the-issue-of-double-count">The Issue of Double-Count</h3> 
<p>Quantifying the true value of cryptocurrency activity through blockchain data has long posed a challenge. Glassnode, a data provider, has suggested that the purported $3 trillion total market circulation during the peak of the 2021 bull market was in reality closer to $875 billion.</p> 
<p>Stablecoin transactions often face the issue of double-counting, depending on the platforms involved in fund transfers. For instance, if a user converts $100 of Circle Internet Financial Ltd.’s USDC to PayPal’s PYUSD on Uniswap, a decentralized exchange, $200 of total stablecoin volume would be recorded on-chain, according to Cuy Sheffield, Visa’s head of crypto.</p> 
<p>Companies like Visa, which processed over $12 trillion worth of transactions in the previous year, stand to potentially lose if stablecoins gain widespread acceptance as a payment method.</p> 
<p>Analysts at Bernstein predicted last year that the total value of all stablecoins in circulation could reach $2.8 trillion by 2028.</p> 
<p>The post <a href="https://coingape.com/visa-survey-uncovers-stablecoin-reality-90-users-arent-real/">VISA Survey Uncovers Stablecoin Reality, 90% Users Aren’t Real</a> appeared first on <a href="https://coingape.com">CoinGape</a>.</p>

VISA Survey Uncovers Stablecoin Reality, 90% Users Aren’t Real

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Coingape News Media

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