From 24/7 Wall St. · Omor Ibne Ehsan · · 1m 30s
Visa's stablecoin bet grows 15x, but does it justify $370?
Visa's stablecoin settlements jumped fifteenfold while core payments hit records, but the real test is whether crypto rails boost or erode margins.
In brief
Visa's stablecoin settlements jumped fifteenfold while core payments hit records, but the real test is whether crypto rails boost or erode margins. Visa's stablecoin volume grew 15x on a tiny base while quarterly payments crossed $4 trillion for the first time, but rising client incentives may erode margins faster…
Stablecoin settlements jump 15x
Visa's stablecoin settlement volume grew fifteenfold in a year. The stock trades near $370, close to its 52-week high of $385.57.
Tiny base, huge percentage gain
The 15x jump describes an annualized pace on a new rail, not actual revenue. Quarterly payments volume crossed $4 trillion for the first time, up 10% year over year.
CEO frames it as optionality
Ryan McInerney said stablecoins haven't scaled beyond a few use cases. Visa's role is helping clients connect to the ecosystem securely, not picking winners.
“Our role is not to pick winners. Our role is to help clients connect to the stablecoin ecosystem securely and at scale”
Mastercard builds the same rails
Mastercard is building identical multi-chain settlement infrastructure. PayPal sits on the other side as an issuer with PYUSD, trying to capture value in the coin itself.
Strong quarter, pricey valuation
Q3 revenue rose 14.4% to $11.63 billion, with EPS beating estimates. The stock carries a 32x trailing PE and 25x forward PE, with a $419.36 analyst target.
Client incentives are the risk
Client incentives grew 18% year over year, faster than revenue growth. If that acceleration continues while pricing power fades, stablecoin optionality won't offset margin erosion.
The big picture
Visa's stablecoin volume grew 15x on a tiny base while quarterly payments crossed $4 trillion for the first time, but rising client incentives may erode margins faster than new rails can offset.
