Visa Paves the Way for Cryptocurrency Settlements
Key Takeaways
- Visa moves to embrace payments directly in cryptocurrency without fiat conversion
- The card network partnered with Crypto.com and plans to open up to more businesses
Visa Embraces Crypto
In the final week of March, Visa became the first payment processor to settle transactions in cryptocurrency. In a pilot program with Crypto.com, a cryptocurrency platform, the payment giant allowed settlements of transactions with direct acceptance of USD Coin (USDC). In order to carry out the transactions, Visa uses the Ethereum blockchain.
“The announcement today marks a major milestone in our ability to address the needs of fintech0 managing their business in a stablecoin or cryptocurrency, and it’s really an extension of what we do every day, securely facilitating payments in all different currencies all across the world,” said Jack Forestell, executive vice president and chief product officer at Visa.
A World-First in Stablecoin Payments
The selected cryptocurrency for the settlements, USD Coin, is a stablecoin whose value is pegged to the US dollar. It was chosen by Visa due to its “demand, stability and security”, according to a blog post, describing the new service. The process works with a Crypto.com Visa card, which settles the transaction in USD Coin and strips out the need to go through a conversion rate that has additional costs. Later in the year, Visa is planning to offer the service to more partners.
“Having been a Visa partner for several years, we’re excited to deepen that relationship through our global agreement and to pioneer an exciting world-first in stablecoin payments,” the CEO of Crypto.com, Kris Marszalek, said.
Visa is one of the latest major corporations to embrace digital assets, following BNY Mellon, Mastercard, PayPal, and more. “At Visa, we are on a mission to connect the world through the most innovative, reliable, and secure digital payment network—and we’re continuing to push the boundaries of that network by connecting to public blockchains and new forms of money. We’re proud of the work we’ve done so far and excited about what the future holds,” the post concluded.
The cryptocurrency momentum for the first quarter has onboarded large investment banks, payment networks, big corporations, and institutional investors. JPMorgan Chase, Goldman Sachs, Fidelity Investments are all making their own moves towards embracing the digital asset market.