Visa and Anchorage Digital have agreed to let financial institutions use USDPT, Western Union’s dollar-pegged stablecoin, to settle payments on VisaNet. In a statement shared with The Block, Anchorage Digital said Visa and its eligible partners will be able to settle obligations arising from card transactions directly in USDPT.
How will USDPT work on VisaNet?
When a customer pays with a Visa card, the financial institutions involved settle the payment after the transaction is approved at checkout. This is where USDPT comes in.
A bank, for example, will be able to use USDPT to pay Visa what it owes for its customers’ card purchases. Cardholders won’t need to open a crypto wallet or buy USDPT.
USDPT is the first stablecoin the two companies have included in the agreement. Visa and Anchorage have also agreed on a framework for evaluating other stablecoins issued by Anchorage Digital Bank.
Anchorage has issued USAT for Tether, USDGO for OSL Group and USDtb for Ethena Labs. The companies have yet to name a second token or give a timeline for adding one to VisaNet.
Western Union launched USDPT on Solana in May
Western Union launched USDPT on Solana on May 4. Anchorage Digital Bank, a federally regulated U.S. bank, issued the token, while Fireblocks provided the wallet and settlement infrastructure. One of Western Union’s first uses for USDPT was to move funds between the company and its local agents.
The Philippines and Bolivia were the first two markets where Western Union introduced USDPT. The company’s long-term goal is to settle payments around the clock across its network, which spans more than 200 countries. The Visa agreement will extend USDPT’s use beyond Western Union’s agent network to financial institutions that participate in VisaNet.
Anchorage Digital CEO Nathan McCauley said financial institutions care as much about who issues a digital currency and how that issuer is regulated as they do about transaction speed. Anchorage sees the Visa partnership as part of its effort to become a stablecoin settlement bank for institutional clients. Alongside issuing tokens, the bank aims to hold digital assets on behalf of institutions and settle payments they make with those assets.
Visa’s annualized stablecoin settlement volume reaches $20 billion
Visa reported in September that its stablecoin settlement volume had reached an annualized rate of $20 billion. The figure represents the volume Visa would settle in a year if September’s pace held. According to Visa, that rate was more than 15 times the level recorded a year earlier.
Visa has also expanded the list of blockchains it supports for settlement. After adding Canton, Base and Tempo, Visa brought Monad into the program on November 10. Monad brought the number of networks available to participating institutions to 10, while the Anchorage agreement adds USDPT to the digital currencies they can use for settlement.
