Can Stablecoins Break Visa’s Moat? Are Amazon & Walmart for Real?

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In recent weeks, a seismic shift has begun reshaping the future of digital payments. On June 13, the Wall Street Journal revealed that retail behemoths Walmart and Amazon are actively exploring the launch of their own stablecoins—digital tokens pegged 1:1 to the U.S. dollar. Just days later, on June 17, the U.S. Senate passed the landmark GENIUS Act, establishing a federal framework for stablecoin regulation and authorizing private companies to issue digital dollars. These developments have sparked intense debate: Could stablecoins finally allow merchants to bypass traditional card networks like Visa, threatening its long-standing dominance?

For investors and financial strategists, this isn't just a crypto trend—it's a potential redefinition of payment economics.

The Strategic Allure of Stablecoins for Retail Giants

We approach this topic not as crypto enthusiasts, but as fundamental investors focused on cash-generative businesses. While speculative digital assets remain high-risk, blockchain-based stablecoins present a unique case: they offer real utility in reducing transaction costs—especially for low-margin retailers.

Consider Walmart, which operates on an EBIT margin of approximately 4%. Unlike retailers in markets like Australia (where credit card fees are passed to consumers), Walmart absorbs an average 1.4%–2.2% interchange fee on every Visa or Mastercard transaction. That’s roughly $2 billion annually in fees alone.

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Now imagine Walmart replacing card payments with a proprietary stablecoin. By cutting out interchange fees, it could reduce its cost base by up to 2%, potentially boosting EBIT margins from 4% to 6%—a 50% increase in operating profit. This isn’t speculation—it’s financial engineering with real bottom-line impact.

Amazon faces a similar incentive. With billions in card fees paid yearly, a shift to a closed-loop stablecoin system—where customers use “Amazon Coin” in-store or online—could eliminate third-party tolls entirely. Transactions would settle instantly on-chain, bypassing banks and card networks.

This isn’t about betting on crypto; it’s about retailers reclaiming control over payment economics.

What Are Stablecoins? The Digital Dollar Revolution

At their core, stablecoins are digital tokens designed to maintain a stable value—typically pegged 1:1 to a reserve asset like the U.S. dollar. Think of them as digital cash: reliable, instant, and borderless.

Unlike volatile assets like Bitcoin, stablecoins (such as USDC and USDT) offer the speed and efficiency of blockchain without price swings. They function like arcade tokens—each worth exactly one dollar—but live on decentralized networks like Ethereum or Solana.

This makes them ideal for:

In 2024 alone, stablecoin networks processed $27.6 trillion in transaction volume—twice the volume of Visa and Mastercard combined. While much of this activity stems from crypto trading, the infrastructure is now being adopted by mainstream institutions.

From Niche to Norm: The Stablecoin Surge

Just a few years ago, stablecoins were tools for crypto traders. Today, they’re becoming foundational to global finance.

The total market cap of major stablecoins now exceeds $250 billion, growing at ~30% year-over-year. Companies like PayPal (PYUSD) and fintechs like Stripe have launched or integrated stablecoin support, signaling institutional validation.

Even more telling is China’s precedent. In less than a decade, WeChat Pay and Alipay built closed-loop ecosystems serving over a billion users—processing trillions in transactions—without touching Visa or Mastercard rails. Merchants pay fees as low as 0.4%, compared to Western interchange rates of 1.5–3%.

This “leapfrog” model proves that when a low-cost, seamless alternative emerges at scale, both consumers and businesses will adopt it rapidly.

Can Retailers Bypass Visa’s Toll?

The answer, increasingly, is yes—if they choose to.

With the GENIUS Act paving the way for regulated corporate stablecoins, Walmart and Amazon could soon issue their own digital dollars. Customers could top up a wallet with “Walmart Coin” and spend it online or in-store—no bank or card network involved.

This would create a self-contained payment ecosystem, where:

And while Visa currently earns 15–20 basis points per transaction for authorization and fraud management, that role could be outsourced—or replicated internally by large retailers.

However, the real losers wouldn’t be Visa—they’d be issuing banks, which capture the bulk of interchange revenue (1–3%). In a stablecoin world, retailers could reclaim issuer economics while still paying a slim network fee to Visa for infrastructure services.

Do Stablecoins Threaten Visa’s Global Moat?

Visa’s dominance rests on three pillars: network scale, brand trust, and seamless integration. With over 150 million merchant locations and decades of consumer habit, its moat remains deep.

Today, merchant adoption of stablecoins is still low due to:

For most people, tapping a Visa card or Apple Pay is simpler than managing a crypto wallet. Visa offers fraud protection, dispute resolution, and universal acceptance—features blockchain payments lack.

Yet the long-term threat is real. If stablecoins gain regulatory clarity and improve user experience, they could erode Visa’s volume in key areas:

Analysts at Barclays have called the near-term threat “overblown,” but agree that stablecoins are a credible catalyst for change.

Visa’s Countermove: If You Can’t Beat ’Em, Join ’Em

Visa isn’t waiting to be disrupted—it’s leading the charge.

In 2023, Visa became one of the first major networks to pilot stablecoin settlement using USDC on Ethereum. Instead of batched bank wires, acquirers can now settle transactions in near real-time—24/7.

To date, Visa has processed over $225 million in stablecoin settlements through its treasury system. It’s also launched the Visa Tokenized Asset Platform (VTAP), enabling banks and fintechs to mint and manage stablecoins on regulated blockchains.

Even more impactful: crypto-linked Visa cards have facilitated nearly $25 billion in spending** and over **$100 billion in crypto purchases. These cards convert stablecoins to fiat at point-of-sale—ensuring Visa still earns a fee, even when users spend digital dollars.

👉 See how legacy networks are adapting to tokenized finance.

As Visa’s Chief Product Officer stated in April 2025:

“Stablecoins, paired with Visa’s world-class tech, offer the promise to modernize global money movement.”

Visa isn’t fighting the future—it’s building it.

Competitors and Allies: Mastercard, PayPal, and Circle

Visa isn’t alone. Mastercard has partnered with platforms like OKX and Nuvei to enable stablecoin payments for consumers and merchants. It now offers settlement in USDC and is rolling out on-chain transfer services.

Meanwhile, PayPal’s PYUSD stablecoin allows users to transact within its ecosystem without touching card rails. Stripe offers stablecoin payouts in 100+ countries—ideal for gig workers needing fast cross-border payments.

And Circle, issuer of USDC, has become a critical infrastructure layer—partnering with both Visa and Mastercard to make stablecoins spendable at millions of merchants.

This blurring of lines—where competitors become collaborators—signals a new era: one where traditional finance and crypto converge.

Long-Term Outlook: Disruption or Coexistence?

Will stablecoins dethrone Visa? Probably not—at least not anytime soon.

But they will force evolution. The most likely outcome is coexistence, where:

Visa’s fastest-growing segment today? Not transaction fees—it’s value-added services like fraud analytics and data insights. These aren’t threatened by payment rails; they’re enhanced by them.

As one analyst put it:

“The threat isn’t that stablecoins will replace Visa—it’s that they’ll make Visa better.”

Frequently Asked Questions (FAQ)

1. Can Walmart or Amazon really replace Visa with their own stablecoins?

Technically, yes—but only within their own ecosystems. They’d still need infrastructure for fraud detection, KYC, and cross-platform compatibility, which makes full independence unlikely.

2. Are stablecoins safe for everyday transactions?

Major stablecoins like USDC and PYUSD are backed 1:1 by reserves and regulated entities. They’re far safer than volatile cryptos—but lack chargeback protections like credit cards.

3. Will stablecoins eliminate credit card fees?

Not entirely. While merchants could cut interchange fees, they’d still pay network or compliance costs—just potentially lower ones.

4. Is Visa losing relevance because of stablecoins?

No—Visa is actively integrating stablecoins into its systems. It aims to be the bridge between traditional finance and digital assets.

5. How does the GENIUS Act affect stablecoin adoption?

It provides regulatory clarity, allowing private companies to issue digital dollars under federal oversight—accelerating institutional adoption.

6. Can average consumers use stablecoins easily today?

Not yet—at least not at scale. Wallet complexity and lack of merchant support remain barriers. But platforms like PayPal are simplifying access.

👉 Explore how digital dollars are reshaping global commerce—before it goes mainstream.

The rise of stablecoins isn’t just a crypto story—it’s a fundamental shift in how value moves. For Visa, it’s not an existential threat, but a transformative opportunity. And for the world’s largest retailers? It’s a chance to finally break free from the credit card toll.

The future of payments isn’t either/or—it’s both: blockchain efficiency meeting institutional trust. And in that convergence, everyone stands to gain.