Category Archives: Stablecoin

Visa Stablecoin Platform

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Exec Summary

  • Consumers never wanted stablecoins, they wanted 5% yield or a crypto off ramp, BIS data confirms retail use is under 1% of volume
  • Stablecoins are a settlement innovation, networks did not hijack them, incumbents always adopt new tech to compete
  • Visa’s value is governance, operations, and distribution, VSP is just the next network in the network of networks
  • VSP = single Visa managed environment to mint, burn, move, and manage OUSD, with wallet as a service, passkeys, maker/checker controls
  • OUSD first because compliance and trust win, banks trust banks, not Circle, 63% of corporates want stablecoin access via their bank (EY Parthenon)
  • Use cases anchor on ramps and off ramps, treasury funding, global payouts, merchant settlement, stablecoin linked cards ($7B settlement run rate, 160+ programs)
  • VSP is to stablecoin what Visa DPS is to debit, same playbook, different rails and connection points
  • Visa enables Bank Issuers without picking winners, Mastercard bought BVNK and owns a single roadmap, overlap is real but philosophies differ
  • Enablement models win, every member becomes an investor in the network’s growth
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SWIFT – Tokenized Payments/Deposits – Parsing the Hype

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Last week SWIFT announced that 17 of its member banks tested its new blockchain ledger, positioning the network for “tokenized cross border payments” (SWIFT press release). Cue the headlines. My view: this is a me too announcement from an incumbent that is meaningfully behind, and it does not change the trajectory of where tokenized money is actually settling.

The real story is that the big banks are not waiting for SWIFT. They are building their own tokenized deposit networks, joining Canton, integrating with commercial customer platforms like Fireblocks, and quietly redrawing the settlement map. SWIFT gets to be one option among many, useful when a correspondent bank leg or a customer requirement forces its inclusion. It is no longer the default.

Regular readers will recognize this thesis from prior posts. See JPMorgan, Citi and TCH: Tokenized Deposits ON Chain, Augustus Protocol and Emerging Settlement Standards, and the 101 Update on CBDCs, Stablecoins and Tokenized Deposits for the underlying architecture and taxonomy. This post extends the thesis by explaining what the SWIFT announcement actually tells us and what it does not.

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Mastercard Explores Vocalink Sale

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The Financial Times reports that Mastercard is exploring a sale of Vocalink, and is also considering a divestiture of the real-time payments unit it built from its 2019 acquisition of the Nets Group’s account-to-account assets. Taken together with April’s $1.8 billion acquisition of stablecoin infrastructure provider BVNK, this is a clean strategic pivot: Mastercard is walking away from a decade-long attempt to build a services layer on top of bank-owned A2A rails, and redirecting that capital toward digital asset infrastructure. It is the right call. It also raises a question Mastercard should be asking itself very carefully before the BVNK integration gets too far along.

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Open USD – Stablecoin’s New Gold Standard for Trust, Compliance, Governance and Economics

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July 1, 2026

Executive Summary

  • 140+ institutions — Visa, Mastercard, Stripe, BlackRock, Google, Coinbase, and major global banks form the largest stablecoin consortium ever assembled

  • Shares reserve economics — Partners receive yield from underlying reserves, not the issuer; flips the Circle/Tether model

  • Zero-fee minting at scale — No volume limits, no enterprise penalties

  • Pre-transaction compliance — Transfer hooks block sanctioned transactions before settlement, not after

  • Burn and clawback authority — Architectural ability to freeze/burn for OFAC compliance built into Token-2022 implementation

  • Confidential transfers with regulatory visibility — ZK-encrypted balances for corporate privacy; viewing keys for auditors

  • Neutral governance — Independent board of ecosystem partners; no single corporate controller

  • Stripe default — “The default stablecoin for businesses running on Stripe”

Yesterday, we witnessed the launch of what may become the most consequential stablecoin ever: Open USD (OUSD). With over 140 financial, technology, and crypto institutions signing on—from Visa and Mastercard to Stripe, BlackRock, and Google. This isn’t merely another stablecoin entering a crowded market. This is the emergence of a new trust network architecture that I’ve been writing about for years.

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ZelleUSD — A Private Coin

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Builds on: Stablecoins: A New Model of Trust | JPMorgan, Citi and TCH: Tokenized Deposits ON Chain | Open Banking, Open Payments and Trust Networks

Early Warning announced this week that Zelle is going international, starting with India — the world’s largest remittance destination. Alongside this, they unveiled ZelleUSD (ZLUSD), which they’re calling a “proprietary U.S. dollar-backed stablecoin.” Cue the analyst notes about banks “finally getting into stablecoin.”

I’m already laughing… this is Banks BEATING Stableocin and Remittance Providers at their own game with a closed network. This Is Not a competitor to USDC, and you can’t buy it on Coinbase, so Don’t Get Confused.

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Proposed Stablecoin KYC Rule

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The Fed/FinCEN and OFAC just revealed their proposed Stablecoin KYC rule and consistent with the GENIUS Act it entails bank-level KYC requirements for Stablecoin Issuers (see blog: No more Stablecoin “rewards”). This combined with the 303-page FinCEN/OFAC rule on transaction monitoring and secondary uses places substantial compliance burdens on Stablecoin issuers. So much that it is said the hottest job in Fintech is in Stablecoin compliance.

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Augustus Protocol & Emerging Settlement Standards: The Crypto Clearing Bank Arrives

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In May 2026, Augustus (formerly Ivy) received conditional OCC approval to establish the first “AI-era clearing bank” a federally chartered national bank built on a stablecoin-native core designed for 24/7 programmable clearing. The announcement has drawn attention for its ambition: replacing legacy correspondent banking infrastructure with always-on, machine-initiated settlement. But beneath the compelling narrative lies a more nuanced reality about the structure of U.S. financial settlement and the commercial dynamics that govern it.

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Stablecoin Strategy – Visa and Mastercard Are Taking Very Different Roads

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The two dominant card networks are both committed to stablecoins. Both see digital assets as a meaningful component of their long-term growth story. Both have articulated clear strategies to their investors. But the roads they are taking could not be more different and the implications for how value-added services grow, who captures the upside, and how fast innovation moves are significant.

Mastercard is buying the infrastructure. Visa is building a network and enabling shared investment.

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The CLARITY Act Is Locked — And Stablecoin Payments Just Lost Their Best Argument

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When I wrote Stablecoin Rewards’s Last Hope – The CLARITY Act in February, the Senate was deadlocked, Coinbase had just walked out of the markup, and the White House was scrambling to hold a fragile coalition together. The central question was whether the Alsobrooks Compromise — activity-based rewards in, idle yield out — could survive the banking lobby long enough to reach a floor vote.

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FIncen / OFAC 303 Page Rule Squashes Stablecoin eCom Ambitions

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Exec Summary

  • New 303 Page FINCEN/OFAC Rule, aligns to the clear language of the Genius act, but IMHO will create major friction for use of USD stablecoins in eCommerce

  • Rules for tracking parties and monitoring secondary activity create a compliance regime that burdens every party with the need to understand the provenance of a coin. Can you imagine accepting $2000 for a new TV, shipping it out, then having your stablecoins burned?

  • So not only do we have KYC but we have SAR reporting requirements as PPSIs must also comply with SAR and the “Travel Rule” (31 CFR 1010.410(f)), which involves collecting and transmitting information about the originators and beneficiaries of funds transmittal.

  • Banks and Stablecoin Issuers that jumpted into Solana’s Token-2022 model saw this coming and are well placed to move forward

  • This creates substantial advantages for banks in sweeping coins into covered accounts and freshly minting new coins when required. 

  • Great news for Big Banks and V/MA. card gain signficant advantage over stablecoins with the proposed rule

  • I see this as tailwind for stablecoins in settlement, but a big headwind for stablecoin in eCommerce (with a few exceptions). 

  • My views on Stablecoin winners and losers remain unchanged except for an update to winners for x402.

  • No wonder Jamie Dimon remains confident that the banks will win, it will take years for stablecoin startups to build the regulatory muscle required to manage 303 pages of FinCEN mandates. By the time they do, the banks will already be running their own stablecoin subsidiaries under the very same rules.

The Rule

The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) and OFAC issued a 303-page proposed rule implementing the GENIUS Act, reclassifying permitted payment stablecoin issuers (PPSIs) as financial institutions under the Bank Secrecy Act. Requirements include bank-grade KYC, suspicious activity reporting, transaction blocking/freezing capabilities, and appointment of a U.S.-based compliance officer. Enforcement begins January 2027. A 60-day comment period opens now.

The NPRM (Notice of Proposed Rulemaking) introduces 31 CFR Part 1033, which specifically outlines the obligations of PPSIs. The density of this document reflects the complexity of applying traditional banking rules to a distributed ledger environment.

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