Visa (V) stock dropped almost 5% on Wednesday after the U.S. Senate passed new stablecoin legislation. The move has sparked investor concern, as stablecoin-based payment systems could potentially let merchants sidestep traditional credit card networks, posing a long-term threat to Visa’s core business model. Similarly, Mastercard (MA) dropped over 5% in Wednesday’s session.
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On the other hand, crypto exchange Coinbase Global (COIN) surged over 16% as a potential winner from the stablecoin legislation.
What’s Happening with Visa Stock?
Over the past week, shares of Visa have dropped around 5% following a June 13 report by the Wall Street Journal that retail giants Amazon (AMZN) and Walmart (WMT) may issue their stablecoins. The move could reshape payment systems and reduce dependence on banks and traditional card networks.
Adding to the pressure, the U.S. Senate passed a stablecoin bill this week, viewed as a step toward legitimizing the crypto industry. Known as the “GENIUS Act,” the legislation introduces federal oversight for stablecoins and lays out the first official framework allowing private firms to issue regulated digital dollars. However, the act must still clear the House before heading to President Donald Trump for final approval.
Wall Street Brushes Off Stablecoin Threats to Visa
The recent selloff makes sense, as the widespread adoption of stablecoins could pose a threat to card networks like Visa and Mastercard, which rely on transaction fees from traditional card payments. However, industry experts on Wall Street believe retailers will face significant challenges in getting consumers to embrace crypto at checkout, meaning the card giants are unlikely to feel any immediate impact.
Meanwhile, William Blair’s five-star-rated analyst Andrew Jeffrey sees the recent selloff as a potential buying opportunity. He argues that despite merchants’ interest in stablecoins to reduce card fees, the technology isn’t well-suited for mainstream business-to-consumer transactions.
Is Visa Stock a Good Buy Right Now?
Overall, Wall Street has a Strong Buy rating on V stock, based on 24 Buys and four Holds assigned in the last three months. The average Visa share price target is $388.85, implying a 14% upside from current levels.
