Visa moves forward with its stablecoin strategy via an investment in Velocity, adding to the pair’s existing work on settlement and Visa Direct.
Visa, Circle and Ripple have backed an effort to reduce the amount of money payment companies need to hold in advance before transactions can settle.
The companies have joined a $10m extension to Velocity’s Series A, taking the stablecoin payments and treasury platform’s total Series A funding to $48m.
Velocity, a UK-based fintech, provides infrastructure that allows issuers, acquirers, payment providers, financial institutions and merchants to use stablecoins for settlement, liquidity and treasury without replacing existing systems.
Rubail Birwadker, Global Head of Growth Products and Strategic Partnerships at Visa, said stablecoins are becoming a more important part of how value moves across the company’s network.
“Companies like Velocity are helping accelerate adoption and unlock new opportunities for our customers and partners,” he said.
Stablecoins have been praised for several benefits, including reducing the need for prefunding by allowing money to move between markets without positioning funds in advance.
This also gives treasury teams more flexibility over where liquidity sits and when it can be moved, especially across international operations where cut-off times and weekends can delay settlement.
Velocity is also pitching its platform as a way to reap these rewards without replacing existing infrastructure, which can be costly for institutions.
The funding extension follows Velocity’s $38m Series A earlier this summer, which was co-led by Dragonfly and FirstMark and included backing from Capital One Ventures, Coinbase Ventures and QED Investors.
Different backers, different parts of payments
Commenting on the new investors, Eric Queathem, Founder and CEO of Velocity, said the mix of companies joining the round was one of its main attractions.
“These investors operate at the centre of that ecosystem and will provide invaluable insight as we use stablecoins to transform the experience,” he said.
Each company brings a different perspective to the table on how stablecoins could fit into mainstream payments.
Visa operates one of the world’s largest card networks and has been expanding its work with stablecoins across settlement and money movement. Meanwhile, Circle sits on the asset side as the issuer of USDC and Ripple has spent years developing infrastructure for institutional payments and cross-border transactions.
The mix gives Velocity access to expertise across card payments, stablecoin issuance and blockchain-based money movement, areas that all feed directly into its settlement and treasury proposition.
Haun Ventures, a venture capital firm focused on crypto and Web3, has previously backed stablecoin infrastructure companies including Bridge and BVNK.
Chris Ahn, Partner at Haun Ventures, described Velocity as the “next evolution” of that investment thesis, adding that “Stablecoins are moving beyond faster transactions to become a foundational layer for global finance.”
Visa and Velocity working together
Visa’s investment in Velocity follows recent speculation that the payments giant was searching for a new stablecoin partner after Mastercard acquired BVNK for $1.8bn. However, Payment Expert reported last month that those claims blurred two different parts of Visa’s infrastructure.
Sources close to the matter said BVNK wasn’t used for stablecoin settlement through VisaNet, with its role focused on stablecoin payouts and prefunding through Visa Direct.
Earlier this month, MVB Financial announced it would participate in a Visa Direct pilot using Velocity’s infrastructure to support stablecoin-enabled funding and settlement for eligible push-to-card payouts.
The arrangement allows MVB to use stablecoins to settle certain Visa Direct obligations, with Velocity handling the infrastructure linking stablecoin liquidity with the bank’s existing payment operations.
Queathem said at the time that this is “exactly where we believe stablecoins become most meaningful”, explaining it’s when they integrate with existing infrastructure.
“Visa Direct is a powerful starting point because it shows how stablecoin liquidity can connect directly into established global payment rails,” he said.
