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So far, the role of stablecoins in global transactions has become a focal point of discussions just as the crypto markets continue to go mainstream. However, with mounting concerns over the reliability of available data, Visa, a long-standing leader in financial services, has stepped forward to clarify the landscape.
Under the guidance of Cuy Sheffield, Visa’s Head of Crypto, the company recently launched an Onchain Analytics Dashboard aimed at cutting through the “noise” and providing a more accurate reflection of stablecoin activities, as highlighted by the report.
Decoding The Noise In Crypto Stablecoin Transactions
The introduction of this dashboard is Visa’s response to the prevalent issue of “misleading data” surrounding stablecoin usage. Despite their growing popularity, distinguishing genuine user transactions from automated bot activities remains challenging.
According to Sheffield’s recent insights on X, the new tool is designed to provide a “clear and accessible” view of the blockchain, focusing initially on stablecoins.
By filtering out noise such as bot transactions, which often inflate volume figures, the dashboard offers a “genuine” snapshot of stablecoin traction.
Visa’s analysis, driven by its innovative dashboard, has uncovered three critical trends that could reshape understanding of stablecoins’ market role.
Firstly, the total supply of stablecoins is nearing record highs, approaching $150 billion. This uptick indicates revived interest and trust in stablecoins despite the fluctuating dynamics of the broader cryptocurrency landscape.
Stablecoins compared to mainstream financial systems. | Source: Visa
Secondly, there has been a noticeable increase in active stablecoin users. The dashboard records approximately 27.5 million active users across various chains, highlighting the expanding reach of these digital assets.
A significant revelation from Visa’s tool is the stark contrast between reported stablecoin transfer volumes and those adjusted for non-human interactions.
While the unadjusted transfer volume for the past month stood at roughly $2.65 trillion, Visa’s refined metrics brought this number down to $265 billion, shedding light on the actual scale of organic financial activity.
The Real Story Behind Stablecoin Transactions
Furthermore, recent reports from Bloomberg, elaborating data from Visa, suggest that over 90% of stablecoin transaction volumes may not involve genuine users, hinting that adopting these crypto tokens as mainstream payment solutions might be distant.
Citing data from the dashboard Visa just developed in collaboration with Allium Labs, aimed at filtering out bot and large-scale trader activities to highlight transactions by actual users – In April, of the roughly $2.2 trillion processed, only $149 billion represented genuine, or “organic,” payment activities.
Pranav Sood, executive general manager for EMEA at Airwallex, commented on the data, noting that while stablecoins exhibit potential for long-term relevance, their immediate utility as payment instruments is still developing. Sood noted:
That’s not to say that they don’t have long-term potential, because I think they do. But the short-term and the mid-term focus needs to be on making sure that existing rails work much better.
Featured image from Unsplash, Chart from TradingView
