Visa Cryptocurrency

Visa to accelerate crypto mainstream adoption with new ‘Universal Payments Channel’

Visa to accelerate crypto mainstream adoption with new 'Universal Payments Channel'
Written by publishing team

  • Visa has deployed its first smart contract on the Ethereum Testnet with a payment channel that accepts Ether and USDC.
  • The payments giant has developed a conceptual protocol that enables interoperability between central bank currencies in payments.
  • Visa’s Universal Payments Channel (UPC) will support the exchange of central bank currencies on various blockchains.

Visa is focused on cryptocurrency adoption and has provided a solution for payments using central bank digital currencies via blockchains through its UPC concept.

Visa takes the lead in enabling payments through central bank cryptocurrency

Payments giant Visa led the way in cryptocurrency adoption multiple times in 2021. Earlier this year, the company announced plans to work with local crypto companies and facilitate businesses that accept crypto payments.

The company focuses on combining trusted payment solutions with cryptocurrency payments while innovating in the industry. The US financial services company has developed a protocol that shows how central bank digital currencies (CBDCs) can be exchanged on various blockchain networks and used for payment.

Visa’s concept of a ‘global payments channel’ defines the interdependence of various central bank digital currencies and paves the way for future payments on the financial services giant.

Coy Sheffield, Head of Cryptography at Visa says,

This is a long-term forward thinking concept about how Visa can help become a bridge between one digital currency on one blockchain and another digital currency on another blockchain.

Interestingly enough, the proposed base layer for Visa’s UPC is Ethereum. Although regulation related to cryptocurrency is currently in place in most countries, central institutions around the world have embraced the idea of ​​cryptocurrency.

Therefore, Visa is creating a Center for the Adoption and Use of Central Bank Digital Currencies to promote mainstream adoption of digital currencies. Cryptocurrency analysts are studying the transition of Visa to a key institutional Ethereum adoption.

The analyst with the pseudonym @Pentosh1 responded to the Visa announcement,

Visa agrees that central bank and stablecoin currencies are expected to play an important role in the future of payments between individuals and institutions worldwide.

The Visa white document describes its UPC concept as follows,

The UPC protocol facilitates payments through an entity, called a UPC (or server – we use the terms interchangeably), which acts as a gateway to receive payment requests from registered sending parties and forward them to registered payee parties.

In addition to the development in CBDC acceptance, Visa has published its first-ever smart contract on Ropsten, Ethereum’s testnet. The smart contract accepts both ETH and USDC. According to the head of the crypto division, Visa is keen to ramp up its solutions that include digital currencies and payment products in the future.

Visa aims to be a “network of blockchain networks” through its strides in crypto acceptance and adoption.

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