Visa’s stablecoin pilot could turn a narrative headwind into a tailwind, says Mizuho’s Dan Dolev

Visa's Stablecoin Initiative - Visa's stablecoin pilot program, utilizing Visa Direct, aims to capitalize on the growing stablecoin market [1][3] - Visa Direct processes over $1 trillion in transactions and experiences a 20% compound annual growth rate (CAGR), representing approximately 20-25% of Visa's debit volumes [3][4] - The initiative positions Visa as a key intermediary in stablecoin transactions, enabling interchangeable switching between various stablecoins [7][8] Competitive Landscape & Potential Disruptions - The analysis suggests that stablecoins may disrupt banks by impacting cross-border transaction volumes, potentially diminishing their role as pillars of global finance [11][13] - While stablecoins may not directly disrupt networks, they pose a challenge to traditional financial institutions [11] - The stablecoin market is competitive, implying that not all participants will succeed, and some may face challenges [9] Circle's Position - Mizuho has a sell rating on Circle, citing concerns about USDC circulation and revenue generation as interest rates decline [5][10] - Circle's revenue model, heavily reliant on treasuries, may be negatively impacted by decreasing interest rates [10]