As we all know, cryptocurrency initially promised to completely transform the global payments ecosystem, with faster transactions, borderless transfers, and a system free from traditional middlemen.

Crypto advocates believed that in the future, people would use digital coins to buy everyday items like coffee and groceries.

Stablecoins were introduced to bridge this gap. The concept was simple: combine the advantages of crypto with price stability. These coins are usually backed by fiat currencies, such as the U.S. dollar, to prevent extreme price fluctuations.

However, despite all these promises, Visa and Mastercard still do not view stablecoins as the next big thing for daily payments. Both companies have explored blockchain technology and even conducted pilot programs, but when it comes to everyday consumer payments, they remain extremely cautious.

1. What Was the Core Purpose of Stablecoins?

One of the most significant problems with cryptocurrencies has always been price volatility. The value of Bitcoin or Ethereum can fluctuate drastically within a single day. In such a scenario, no rational consumer would want to pay for coffee or groceries using crypto.

To address this issue, stablecoins like USDC and USDT were created. Their value is typically pegged to a fiat currency—most commonly the U.S. dollar.

In theory, stablecoins should have been perfect for payments: fast, low-cost, and globally accessible. But in real-world implementation, they have encountered multiple structural and operational challenges.

2. The Biggest Roadblock: Regulatory Uncertainty

For Visa and Mastercard, regulation is the most critical factor, and this area remains highly problematic for stablecoins.

In the United States, stablecoins currently exist in a legal grey zone. They are not clearly classified as money, securities, or any other formal financial instrument. Regulatory authorities such as the SEC, the Federal Reserve, and the U.S. Treasury hold differing, and sometimes conflicting, viewpoints.

As global payment networks, Visa and Mastercard are required to comply with strict regulatory frameworks across multiple jurisdictions. Launching stablecoin-based payment systems without regulatory clarity would expose them to significant legal and compliance risks.

In contrast, traditional card payments operate under well-defined rules. KYC, AML, consumer protection mechanisms, and dispute resolution systems have been refined and enforced for decades.

3. Stablecoins Have Not Achieved Mainstream Adoption

Another significant issue is low consumer adoption.

It is widely understood that stablecoins are primarily used by crypto traders, institutional investors, and DeFi participants. The average consumer still relies heavily on cash, cards, or UPI-like systems for daily transactions.

Visa and Mastercard operate on a scale-driven business model. Unless stablecoins achieve massive everyday usage, making large-scale investments in this space does not make economic sense for these companies.

4. Settlement and Liquidity Challenges

Traditional card payments are settled through banks using central bank money. Stablecoins, however, settle transactions on blockchain networks, which introduces a new set of complications.

Liquidity becomes fragmented due to the existence of multiple stablecoins

Blockchain congestion and gas fees remain unpredictable

Risks related to stablecoin reserves and asset custody continue to exist

For companies like Visa and Mastercard, consistency and reliability are non-negotiable. At present, stablecoin-based systems cannot fully guarantee these standards.

5. Focus on Partnerships Instead of Disruption

It would be incorrect to assume that Visa and Mastercard are ignoring stablecoins altogether. Instead, they are adopting a strategic partnership-based approach.

Visa has already tested USDC for select cross-border settlement use cases. Mastercard is actively working on crypto wallets and tokenized payment solutions.

Their strategy is clear:

Innovate without disrupting the existing payment infrastructure.

This approach allows them to benefit from blockchain efficiencies while minimizing regulatory and operational risks.

6. The Future of Payments: A Hybrid Model Is More Likely

The future of stablecoins remains strong, particularly in DeFi and institutional settlement environments. At the same time, governments across the world are actively exploring Central Bank Digital Currencies (CBDCs).

For Visa and Mastercard, the future likely lies in a hybrid payment model where:

Card payments continue on existing rails

Blockchain is used for backend settlement

Fiat currencies, stablecoins, and digital assets can be converted seamlessly.

For tap-to-pay and everyday retail transactions, traditional card-based systems remain more trustworthy, reliable, and widely accepted.