Can Visa’s $670B bet on programmable money rewrite global credit?

Visa just dropped a roadmap for the future of finance, and it runs on programmable money.

In a comprehensive new report, the payments giant is stating to its network of over 15,000 financial institutions that the $670 billion stablecoin lending market is no longer just an experiment in crypto. This market is the foundation for the next generation of global credit markets.

With the GENIUS Act now establishing a regulatory framework for stablecoins in the US, Visa sees an opening to bridge traditional banking with blockchain-based lending protocols that operate 24/7, automatically adjust interest rates based on supply and demand, and settle transactions in minutes rather than days.

Numbers behind the revolution

The data Visa presents paints a picture of rapid institutional adoption. In August 2025 alone, $51.7 billion in stablecoins were borrowed across 427,000 loans from 81,000 active borrowers.

These aren’t small retail transactions, as the average loan size has recovered to $121,000, suggesting institutional players are increasingly comfortable with programmable credit markets.

Additionally, the concentration tells its own story. Two protocols, Aave and Compound, dominate the lending market with 89% of the lending volume, while USDC and USDT account for over 98% of the stablecoin supply powering these markets.

Ethereum and Polygon maintain a roughly 85% market share, while newer chains like Base, Arbitrum, and Solana are gaining ground, accounting for 11% of combined activity.

Borrowing rates averaged 6.4% APR in August 2025, with lending yields at 5.1% APY. These rates sit remarkably close to traditional credit markets, especially considering the 24/7 availability and instant settlement that smart contracts provide.

Three pillars of banking’s blockchain future

Visa’s roadmap centers on three transformative shifts that could reshape how banks think about lending, collateral, and credit assessment.

The first is the tokenized asset market, which has already grown from $5 billion in December 2023 to $12.7 billion today.

McKinsey projects the sector could reach $1 trillion to $4 trillion by 2030, but Visa sees an even bigger prize by connecting the traditional credit market of over $40 trillion to programmable money rails.

BlackRock’s BUIDL Fund exemplifies this evolution, reaching $2.9 billion in tokenized Treasury holdings while serving as collateral across multiple lending protocols.

Franklin Templeton’s OnChain U.S. Government Money Fund adds another $800 million, while MakerDAO now derives nearly 30% of its $6.6 billion balance sheet from real-world assets.

Corporate bonds, private credit, and real estate could soon serve as collateral in always-on global lending markets, creating new liquidity sources for assets that traditionally sat idle between trading sessions.

The next pillar is crypto collateral. Early movers, such as ether.fi, are already launching non-custodial credit cards that enable users to borrow against their crypto holdings while maintaining asset ownership.

This addresses a critical issue of accessing liquidity without triggering capital gains taxes or forfeiting upside exposure.

Real-time collateral monitoring through smart contracts enables automated margin calls and risk management that traditional credit facilities cannot match.

Banks and private credit funds could serve as liquidity providers to these programs, offering institutional capital through programmable protocols rather than bilateral credit agreements.

The third pillar is on-chain identity. The current overcollateralization model, while secure, limits the market to borrowers who already possess significant assets.

The next breakthrough involves developing on-chain identity and credit scoring systems that analyze wallet transaction history, asset holdings, and protocol interactions to construct credit profiles.

Platforms like 3Jane, Providence, and Credora are pioneering methods to assess creditworthiness based on verifiable on-chain behavior, all while preserving privacy through the use of zero-knowledge proofs.

This could eventually enable protocols to offer undercollateralized and unsecured loans based on reputation and credit history.

Opportunities and changes needed

The shift from traditional lending to programmable credit markets requires fundamental changes in how financial institutions assess and manage risk.

Instead of analyzing balance sheets and legal agreements, banks must evaluate protocol security audits, governance structures, and the reliability of data sources.

This doesn’t eliminate risk, but instead transforms it. Counterparty risk can be managed through smart contracts and automated liquidation, but technology risk becomes paramount.

Banks need new frameworks for understanding smart contract vulnerabilities, governance token voting mechanisms, and oracle dependencies.

In addition, three case studies in Visa’s report demonstrate how leading protocols are already serving institutional needs beyond crypto trading.

Morpho aggregates demand and liquidity across platforms, enabling users on Coinbase to tap into shared pools that include deposits from Ledger wallet users and institutional partners, such as Société Générale.

Credit Coop uses programmable lockboxes to enable revenue-based lending, with stablecoin-linked card issuer Rain borrowing over $175 million in USDC against future receivables.

Huma Finance powers cross-border payment financing with a $500 million monthly transaction volume, offering APYs of 10% or more to lenders through rapid capital recycling.

These are production systems that process hundreds of millions of dollars in monthly volume, while offering yields that traditional banking products struggle to match.

Visa’s message to its bank partners is that the infrastructure for programmable lending already exists, processes billions in monthly volume, and offers competitive rates with superior transparency and automation.

The regulatory framework is emerging, institutional adoption is accelerating, and technical risks are increasingly well understood.

Organizations that embrace this infrastructure today position themselves to lead tomorrow’s global credit markets. Those who wait may find themselves competing against always-on, algorithmically managed lending protocols that offer 24/7 service, instant settlement, and transparent pricing.

The question for traditional banks isn’t whether stablecoin-powered lending will reshape credit markets, as the data suggests it already has.

The question is whether they’ll participate in defining that future or find themselves disrupted by it.