Visa Expands Stablecoin Settlement as Holiday Spending Rises 4.2%

Visa Sees Stablecoin Settlement Expand as Holiday Spending Rises

Visa Inc. (V) reported a 4.2% increase in U.S. holiday retail spending for the period from Nov. 1 to Dec. 21, according to its Retail Spend Monitor framework. This data excludes categories like autos, gasoline, and restaurants, but it highlights the resilience of consumer spending amid economic uncertainty. Meanwhile, Visa has made significant strides in digital payment infrastructure, particularly in stablecoin settlement.

Last week, Visa expanded its support for USDC, a widely used digital dollar, allowing issuers to settle transactions using stablecoins rather than waiting for traditional wire transfers. This move positions Visa as a key player in the emerging stablecoin ecosystem.

Visa also announced a $500 million deposit into its U.S. litigation escrow account under its retrospective responsibility plan. This action adjusts conversion rates for its Class B-1 and Class B-2 shares into Class A shares, effectively functioning like a stock repurchase.

Why the Standoff Happened

The 4.2% spending increase, while positive, came in slightly below Visa's earlier forecast of 4.6% growth. This gap may signal cautious consumer behavior, as shoppers appear more deliberate in their purchases. Online sales, representing 27% of transactions, grew at a faster rate than in-store sales, with electronics leading the charge.

Visa's recent litigation escrow deposit is part of its ongoing legal and regulatory management strategy. The payment giant continues to face scrutiny over fee-related litigation and antitrust concerns, which remain overhangs for the company.

How Markets Reacted

Visa's stock closed at $353.38 on Dec. 23, up $1.29 (+0.37%), with after-hours trading pushing it slightly higher to $353.92 according to market data. The stock remains below its 52-week high of $375.51 but has shown resilience despite a shortened holiday trading week.

Analysts continue to project long-term upside for Visa. MarketBeat lists an average 12-month price target of $402.52, with some forecasts reaching as high as $450. This optimism is based on the company's strong operating leverage and ongoing capital return initiatives.

What Analysts Are Watching

The broader market context includes a mixed signal for consumer-facing companies. While U.S. GDP data came in stronger than expected, consumer confidence fell in December. This creates a nuanced outlook for payment providers like Visa.

Investors are monitoring several key trends: the pace of digital payment adoption, regulatory developments, and the durability of consumer spending. Visa's role in bridging traditional and digital finance—through stablecoin settlement and AI-driven tools—positions it as a leader in the next phase of financial infrastructure.

Visa's recent performance and strategic moves highlight its adaptability in a rapidly evolving payments landscape. As legal and regulatory challenges persist, the company's ability to innovate and maintain profitability will be critical to its long-term success.