Why Visa, Stripe, and Mastercard Launched a Stablecoin in 2026

On June 30, 2026, more than 140 companies that normally compete head-on for the same customers, Visa and Mastercard, Stripe and Coinbase, Google and Shopify, signed onto the same project at the same time.

They weren't merging or forming a cartel. They were jointly launching a stablecoin, a digital dollar token, to compete with two companies most of their own customers have never heard of: Tether and Circle, which between them have quietly controlled roughly 85% of the entire stablecoin market for years.

The fight isn't really about cryptocurrency. It's about who owns the pipes that digital money now runs through, and who gets to keep the profit generated by the reserves sitting behind every token in circulation.

A Stablecoin Is Infrastructure, Not Speculation

A stablecoin is a digital token designed to always be worth exactly one dollar, backed one-to-one by real cash and short-term government debt held in reserve. Unlike Bitcoin or other cryptocurrencies, it isn't meant to go up or down in value. Its entire purpose is to move like a dollar, instantly and globally, without the delays and fees that come with wiring money through banks.

That makes it less a speculative asset and more a piece of financial plumbing, closer to the wire transfer system or a card network than to an investment. And like any piece of plumbing everyone eventually depends on, whoever owns it collects a toll.

Two Companies Quietly Own the Pipes

For years, that toll has flowed almost entirely to two companies. Tether's USDT and Circle's USDC together account for roughly 85% of the stablecoin market, a dominance built on being early and building trust with exchanges and traders before most large financial institutions took the technology seriously.

The business model behind that dominance is straightforward: both companies hold billions of dollars in reserves, mostly short-term U.S. government debt, and keep the interest those reserves earn as pure profit. The token holder gets a dollar that behaves like a dollar. The issuer gets the yield that dollar would otherwise have earned somebody else.

Did You Know?

A stablecoin issuer holding billions in reserves in short-term U.S. Treasury bills earns real, ongoing interest on that money, the same interest a bank would earn holding deposits, except a stablecoin issuer isn't a bank and, until recently, operated under far lighter oversight.

Congress Wrote the Rules, Then Everyone Else Showed Up

Much of the reluctance large, regulated companies had about entering this space evaporated on July 18, 2025, when the GENIUS Act became the first federal law setting clear rules for who can issue a stablecoin, how reserves have to be held, and what issuers can and cannot pay holders. It passed with wide bipartisan support in both chambers.

Regulatory clarity is exactly what a company like Visa or a bank-backed institution needs before committing serious money to a new product line. Once the rules existed on paper, the biggest names in payments had a clear path to enter a market Tether and Circle had built largely without them.

Why the Card Networks Cared at All

Visa and Mastercard didn't join this coalition purely out of curiosity. Stablecoins move money the way a bank wire does, without routing through the card networks at all, which means every transaction that shifts onto stablecoin rails is one that skips the 2 to 3% fee Visa or Mastercard would otherwise collect.

Total stablecoin transfer volume hit roughly 33 trillion dollars in 2025, up 72% from the year before, more than the combined volume Visa and Mastercard moved over their own networks that year, and the businesses with the strongest incentive to route around card fees entirely are exactly the largest merchants: retailers and platforms with enough transaction volume that even a small fee reduction adds up to real money. Visa itself started settling certain transactions in USDC back in 2023, a sign the card networks had already concluded that fighting stablecoins head-on was less promising than finding a way to sit inside the system instead. It's the same underlying dynamic that let India's UPI network bypass the card rails entirely and become the country's dominant way to pay: when a cheaper rail exists, volume eventually finds it.

Joining, and helping build, a stablecoin the card networks have a real stake in is a hedge against the version of this future where merchants quietly route around them entirely.

The Rivals Team Up Instead of Going It Alone

Rather than each launching a competing stablecoin separately and fragmenting the challenge, more than 140 companies chose to back a single joint effort: Open USD, led by Zach Abrams, the co-founder of the payments startup Bridge, which Stripe had already acquired in 2024.

The structural pitch is direct: instead of an issuer keeping the reserve interest as its own profit, Open USD returns most of that revenue to the businesses actually using it, after a small management fee, and offers free minting and redemption. Stripe has already made Open USD the default stablecoin for businesses transacting on its platform, and Coinbase has confirmed it's bringing the token to its own blockchain infrastructure later in 2026.

It's a direct rebuttal to a business model Tether and Circle have never had to defend before, and Circle wasn't going to let it stand unanswered.

Circle's Countermove: Buy the Roads, Not Just the Currency

Circle didn't wait to see how Open USD's launch played out. On September 8, 2026, it agreed to pay 400 million dollars to acquire Tazapay, a Singapore-based cross-border payments company that already moves more than 25 billion dollars a year across over 100 markets, roughly 60% of it already running on stablecoins.

The logic behind the deal is different from simply defending market share in stablecoin issuance. Owning the actual payment rails a stablecoin travels across, the bank relationships, local-currency conversion, and compliance infrastructure in dozens of countries, gives Circle something a rival token can't easily copy just by offering a better revenue split. If Nvidia's chips are the backbone the AI industry runs on, the payment rails a stablecoin actually moves across are the equivalent backbone for global money movement, and Circle just spent 400 million dollars trying to own more of it directly.

Knowlegic Perspective

The AI industry's infrastructure fights get most of the attention: who owns the chips, who owns the power plants, who owns the data centers. A quieter version of the same fight is playing out underneath the world's money movement, and it follows the same basic pattern.

Whenever a piece of infrastructure becomes essential enough, the companies that depend on it eventually stop being content to just use it and start trying to own a piece of it directly. Tether and Circle built the plumbing nobody else wanted to build early on, and collected the toll for years largely uncontested. Now that stablecoins move real money at real scale, the companies that generate that volume, the card networks, the payment processors, the platforms, want a structure where the toll gets shared rather than paid entirely to someone else.

Whoever owns the pipes that money runs through collects the toll, whether that money is called a dollar, a stablecoin, or something nobody has named yet.

Sources & References

• GENIUS Act Signed into Law: US Enacts Federal Stablecoin Legislation, Mayer Brown (2025)
• Stripe, Visa and over 140 other businesses to launch stablecoin to rival Tether and Circle, Fortune (2026)
• Open Standard's stablecoin draws Stripe, Visa and Mastercard, American Banker (2026)
• Disruption or distraction? Why stablecoins haven't shaken the card networks, Third Bridge (2026)
• Stablecoin Transactions Rose to Record $33 Trillion in 2025, Bloomberg (2026)
• Tether and Circle control 85% of stablecoin supply as market concentration stays near record highs, CryptoBriefing (2026)