The Japanese investment bank Mizuho has referred to Visa (V) as the “stablecoin of stablecoins,” suggesting that the payments company has become an essential component of the global stablecoin framework.
According to a recent report, Visa’s growing network of over 130 stablecoin-linked card programs across more than 40 countries, with spending increasing fourfold year-over-year, positions it centrally in blockchain-based payments.
Stablecoins are cryptocurrencies whose value is pegged to other assets such as the U.S. dollar or gold. They are vital in cryptocurrency markets, facilitating payment infrastructure and international money transfers. Tether’s USDT leads as the largest stablecoin, followed by Circle’s (CRCL) USDC.
Mizuho maintains an outperform rating on Visa shares with a price target of $425. At the time of publication, the stock was down 1%, trading around $343.30.
Visa is poised to be a significant beneficiary of stablecoin adoption, aided by the GENIUS Act and its ongoing Visa Direct initiative, according to analysts Dan Dolev and Alexander Jenkins. They noted that Visa Direct has seen an annual growth rate of around 50% since 2016 and now represents roughly 15%–20% of the global debit volume, totaling over $1.1 trillion.
With a diverse range of stablecoins available, including USDT, USDC, PayPal’s PYUSD, and various central bank initiatives, the analysts argue that having a centralized platform like Visa provides a considerable competitive edge.
They also highlighted Visa’s initiative allowing banks to mint and burn their own stablecoins on its tokenized asset platform, implying that individual stablecoins such as USDC are becoming interchangeable, while networks like Visa or Mastercard (MA) are likely to secure the most value.
Currently, Visa’s platform supports four stablecoins: USDG, PYUSD, EURC, and USDC. Mizuho believes this is merely the beginning.
As stablecoins evolve into more commoditized assets, the bank perceives Visa’s role as the “network of networks” or “stablecoin of stablecoins” as a crucial driver for long-term growth.
Mizuho’s analysts reiterated their stance on Circle (CRCL), the issuer of USDC, labeling it as overvalued, with an underperform rating and an $84 price target.
At the time of publication, Circle shares had declined by 3.45%, trading at approximately $131.37.
Read more: Visa Pilots Pre-Funded Stablecoins for Cross-Border Payments
