From Visa and Circle to Cross-Border Stablecoin Payments for Banks

The Visa-Circle deal

Geetha Panchapakesan moved from Visa to Circle in 2021, hired in part to push into TradFi. The deal she worked on had Visa open an account with Circle and settle stablecoins between issuers and acquirers. Earlier, at Visa Direct, she had represented Visa Ventures on the US Faster Payments Council.

She says Visa requires stablecoins received in settlement to be converted back to fiat before 5pm because it does not want to hold them overnight, and that Visa has since expanded to weekend settlement, which she calls a big deal for the company.

From laughter to adoption

About eight months ago, she says, Remitly laughed her out of the room. Now a very large PSP that was once skeptical told her it settles 6% of its cross-border payments with partners in stablecoins. She believes adoption is at the beginning of the hockey stick and expects that a year from now most banks and PSPs will be involved in some way.

Rails, not wallets

Geetha Panchapakesan predicts stablecoins will be back-end rails rather than something people hold and pay with, and that cards and the networks will coexist with them. She sees product-market fit in cross-border payments, not domestic banking, and recommends institutions start with one corridor.

She also argues emerging market banks should become stablecoin-to-fiat conversion hubs, calling it a whole new business model, and says US community banks are losing deposits to providers like Coinbase, with research showing it happening at 100x the rate in emerging markets.

What Tesser sells

Tesser provides wallets, cross-chain swapping, gas and treasury management, compliance and reconciliation, and partners with wallet providers, custodians and networks such as Borderless and CPN. She says not all of the world's 45,000 banks and PSPs will build this themselves.