The world of transactions welcomes Visa, one of the largest payment platforms worldwide. Or rather Visa welcomes crypto transactions? What is a reality is that this multinational started to operate with cryptocurrencies. And the first action was: to accept USDC as a payment currency in the United States.
To clarify, the USDC operates as a stable coin. That is, this currency has, for now, the same value that a traditional currency has. For example, in this case, the US dollar. This cryptocurrency operates via Ethereum. It also has the backing of Crypto.com as a key trading point.
And what was the scenario with Visa before this announcement? Well until now if you wanted to pay in USDC you first had to convert that amount into USD. However, this used to incur extra charges. With Visa’s move, both customers and merchants can now pay and get paid in USDC, with no complications.
To make this a reality, Visa says they partnered with 35 digital currency platforms. This way they can enable the linking of more USDC wallets. For example, Coinbase, BlockFi, or Crypto.com.
This is a great development made by Circle Internet Financial. That’s to say, it allows that USDC cryptocurrency to have more than $11 billion in circulating. This process started a few months ago. In such a way that Visa and Circle Internet Financial linked up to find new uses for USDC. For example, the project to launch a bank card, Circle Visa. So, in that way, will operate with USDC as a cryptocurrency. Let’s see what else this news brings to the crypto transactions landscape.
Crypto transactions in the most recognized payment platforms
Given Visa’s initiative, the response from the competition was not long in coming. Thus, its competition par excellence, Mastercard, also wants to be part of this game. Mastercard announced it also has plans for its customers to make crypto transactions. But it seems that Visa has beaten them to the punch.
But, PayPal has already made its intention evident. Although it is the newest digital payment platform, they still want to enter this market. But for all platforms, new and already positioned in the sector, there is still a long way to go. Even Visa does not have it easy. Since within its crypto transactions plans, they promised to venture into Bitcoin payments.
The challenge for Visa it’s to make instant Bitcoin to fiat currency conversions soon. That is to say, what this firm is aiming at is that from the Bitcoin wallet implemented by them a user can. For example, buy an item that is sold in currency in a specialized store. Then, when they made a payment Bitcoin is converted so that the seller receives dollars.
Although in the crypto transactions world Visa would enter like a Bitcoin’s competitor. But for the ecosystem of digital currencies, it is good news. This way the crypto payments would reach 70 million points of sale worldwide. Or at least that is the number of merchants globally that Visa claims to have to use its payment system. So they got off on the right foot, don’t you think?
Visa’s foray into crypto transactions was to be expected
Visa’s entry into the world of crypto transactions is not surprising. First of all, cryptocurrencies are gaining more and more ground in the world of finance. For example, as a method of savings and value preservation. But also as tools for financial speculation. Secondly, cryptocurrency technology is growing much faster than traditional technologies.
This is confirmed by Ethereum, one of the leading cryptocurrencies on the market. Its creator, Vitalik Buterin, assures that in a matter of a few years his payment network will equal Visa. And this is the motivation for which Visa wants to make inroads into the ecosystem. We must also keep an eye on the strategies that will be deployed by Mastercard, as well as PayPal. Everything is happening for the massification of purchases, transfers, and sales through cryptocurrencies.
The process that led Visa to embrace crypto transactions
Visa was no stranger to the cryptocurrency landscape. For years they partnered on a debit card backed by Crypto.com. In other words, it facilitated their digital currency transactions. But when Visa settled daily transactions, it asked Crypto.com to do the conversion. In this way, it converted the traded digital currencies into fiat currencies, such as U.S. dollars.
Then, as this process is costly, complex, and slow, the company had an initiative in 2019. It consisted of enabling settlements in a digital currency through a public blockchain. And it happened through its partnership with a federal licensed digital asset bank. This entity is Anchorage, the first banking entity to ease this.
This took about two years as they upgraded their infrastructure. This is how Visa piloted the new program using USD Coin. And as we said before, this cryptocurrency is a stable coin powered by Ethereum. This way it allows you to link its market value to the US dollar. In conclusion, this gives it greater stability of its price.
Also, USD Coin has serious compliance and regulatory protocols in place. This gives it much more confidence than other cryptocurrencies. Because USDC is not decentralized and unregulated. To sum up, the panorama is more than optimistic. Do you take the risk to do crypto transactions with Visa? Let us know in the comment section.