Visa Joins Global Dollar Network, Boosting Stablecoin Adoption

Visa has joined the Global Dollar Network (USDG), a stablecoin consortium led by Paxos. This group also includes major players in the cryptocurrency and fintech industries, such as Robinhood, Kraken, and Galaxy Digital. The consortium aims to create a joint stablecoin pegged to the U.S. dollar, which will be backed by Paxos' regulated stablecoin, USDP. This move by
signifies a significant step towards mainstream adoption of stablecoins, as it brings together some of the most influential companies in the financial and cryptocurrency sectors.The consortium’s existing members include Robinhood, Kraken, Galaxy Digital, CoinDesk’s owner Bullish, Anchorage Digital, and payments platform Nuvei. Introduced last November, the initiative is focused on promoting stablecoin adoption and advancing its real-world applications. The network uses Paxos’s new stablecoin, the Global Dollar (USDG), which operates under the Monetary Authority of Singapore’s (MAS) regulatory framework. DBS Bank, Southeast Asia’s largest bank, serves as the custodian and banking partner, managing reserves to ensure full backing and on-demand redemptions.
The stablecoin was initially launched on Ethereum, with support for other MAS-approved blockchains like Solana on the roadmap. USDG aims to differentiate itself in a market dominated by Tether’s USDT and Circle’s USDC by sharing yield with participant firms that create connectivity and liquidity.
Visa's participation in the Global Dollar Network marks a pivotal moment in the evolution of stablecoins. As a leading player in the traditional financial sector, Visa's involvement lends credibility and stability to the USDG stablecoin. This collaboration is expected to drive innovation in the stablecoin market and promote greater integration between traditional financial systems and digital currencies.
By joining the consortium, Visa becomes the first traditional financial institution (TradFi) to back the initiative. This move underscores the growing acceptance of stablecoins within the mainstream financial community and highlights the potential for stablecoins to play a significant role in the future of digital finance. The consortium's efforts are likely to enhance the stability and reliability of the USDG stablecoin, making it a more attractive option for users and businesses alike.

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