Visa and Lloyds Banking Group have completed a live cross-border settlement pilot using USDC, testing how the stablecoin can operate within institutional settlement processes. The USDC used in the trial was acquired through Archax, a UK-regulated digital asset exchange. USDC is a stablecoin — a digital token designed to maintain a stable value against a reference asset, in this case the US dollar — a property that separates it from the price volatility typically associated with cryptocurrencies.

The pilot focused on settlement rather than the payment initiation process. Through real-world transactions, the companies examined how USDC could be incorporated alongside existing financial infrastructure while assessing potential effects on settlement speed, transparency and operational processes. The live transfers were designed to test whether stablecoin settlement can work alongside established banking infrastructure and support transactions beyond traditional banking hours.

Addressing cross-border settlement frictions

The trial was built around practical problems financial institutions face when moving funds between jurisdictions. Cross-border settlement can involve different banking systems, operating hours and financial infrastructures, creating delays and uncertainty around when funds become available.

A central objective was to examine whether stablecoins could address the limitations of traditional cross-border settlement, particularly outside normal banking hours. Conventional settlement can be affected by weekends, holidays and differences in operating hours between financial institutions in different jurisdictions. Transactions initiated outside those periods may not settle until the next available banking window, potentially creating delays of a day or longer.

According to the companies, around-the-clock settlement could give financial institutions greater visibility into the status of funds and improve certainty over when money reaches its destination. It could also reduce the amount of liquidity businesses need to maintain while transactions wait to settle. Visa and Lloyds identified weekends and holidays as periods when continuous settlement could be particularly useful, noting that businesses operating across multiple markets may need to manage obligations regardless of local banking schedules, making settlement timing an important component of treasury and liquidity planning.

Lloyds purchased USDC through Archax

Lloyds obtained the USDC used during the pilot through Archax, a UK-regulated digital asset exchange. The settlement volume was recorded through Lloyds' Corporate Markets operation in Jersey before being transferred to Visa in the United States.

The test also examined settlement across both private and public blockchain environments. Lloyds operated its own node on Canton, using the network's configurable privacy capabilities, while Visa supported settlement on a separate public blockchain. The companies said the test demonstrated interoperability between different blockchain networks, a capability that is becoming increasingly relevant as institutional digital-asset activity develops across multiple blockchain environments rather than concentrating on a single network.

For financial institutions, interoperability can allow liquidity and transaction activity to move between networks while maintaining access to a broader range of counterparties and infrastructure. Visa's role in the pilot was also intended to demonstrate how established payment networks can help reduce the operational complexity associated with stablecoin settlement.

What the executives said

Peter Left, head of digital assets at Lloyds Banking Group, said the bank sees potential applications for stablecoins in cross-border transactions, where differences in markets, currencies and financial infrastructure can increase complexity. The live pilot allowed Lloyds to examine those capabilities using actual settlement activity rather than relying solely on theoretical testing. Left also highlighted the importance of interoperability between blockchain networks, noting that the ability to connect different networks could support broader applications for digital money as institutional adoption develops.

Rob Cameron, Visa's group country manager for the UK and Ireland, said businesses increasingly operate across borders and outside conventional working hours, while existing money-movement infrastructure does not always provide equivalent flexibility.

The pilot demonstrated how stablecoins could operate alongside established banking systems rather than requiring financial institutions to replace their existing infrastructure. This could give banks and corporate clients additional options for determining how and when funds are settled.

Part of a broader digital-asset investigation

The trial forms part of Lloyds Group's broader investigation into digital assets and tokenized money as potential tools for moving value between businesses and financial institutions. It also adds to institutional efforts to evaluate stablecoins through controlled, real-world applications — a reflection of how stablecoins, which first gained traction as trading instruments in cryptocurrency markets, are increasingly being examined by regulated banks and payment companies as potential settlement tools.

Rather than treating digital assets as a replacement for conventional banking infrastructure, the pilot examined how blockchain-based settlement could complement existing systems while improving availability, transparency and flexibility in cross-border financial operations. For the industry, the open questions from here are whether pilots of this kind progress toward standing settlement services, and whether interoperability between private and public networks — tested here by running Canton alongside a separate public blockchain — becomes a standard feature of institutional stablecoin programmes.

Source: CoinTrust