Chamath Palihapitiya Says Stablecoins Are Crypto's 'Second Killer App' After Bitcoin, As Volumes Surpass Visa
Tech investor Chamath Palihapitiya highlighted the rising dominance of stablecoins in the global financial system Tuesday, deeming them one of the hottest cryptocurrency narratives besides Bitcoin (CRYPTO: BTC).
What Happened: As part of his deep dive into the stablecoin market, Palihapitiya noted that stablecoins’ weekly transaction volumes have exceeded that of Visa Inc. (NYSE:V).
These findings were corroborated by a recent report by asset management firm Bitwise, which showed stablecoin transaction volumes overtaking the payments giant by 2024. In 2020, stablecoin volumes were 11% of total VISA volumes.
The dominance led Palihapitiya to call dollar-backed stablecoins, including Tether (CRYPTO: USDT) and USD Coin (CRYPTO: USDC), the “second killer app” in the cryptocurrency space, next to Bitcoin.
Palihapitiya outlined some key developments in the stablecoin market that influenced its growth trajectory. He mentioned Visa’s launch of the Visa Tokenized Asset Platform, Stripe’s stablecoin pilot, and Mastercard’s new features that allow consumers to spend stablecoins.
Why It Matters: The rise of dollar-backed stablecoins has been a hot topic in the cryptocurrency world. According to a multinational bank, Standard Chartered, the total value of the stablecoin market is expected to surge from $230 billion today to $2 trillion by the end of 2028, potentially generating $1.6 trillion in additional demand for U.S. Treasury bills.
None other than President Donald Trump has called on Congress to pass stablecoin legislation, emphasizing the need for clear rules to foster innovation in the cryptocurrency sector.
The SEC has already stated that stablecoins fully backed by physical U.S. dollars or low-risk, short-term liquid instruments and redeemable at a 1:1 ratio with the U.S. dollar will be classified as “non-securities.”
Price Action: Shares of VISA closed 0.70% higher at $337.51 during Monday’s regular trading session. The stock exhibited good momentum and quality scores as of this writing. To know more about these metrics and more, check out Benzinga Edge Stock Rankings.
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Posted-In: Bitcoin Chamath Palihapitiya dollar Stablecoins TetherCryptocurrency News Markets
