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So guys, get this: Flexa and Alchemy Pay may be facing increased competition from the mainstream financial industry soon, if not already, as payments giant Visa Inc is making some bold moves with the launch of its Universal Payment Channel in a bid to become the "universal adapter" of blockchains, connecting crypto assets, stablecoins, and CBDCs.
Move over AMP and ACH, VISA has entered the chat!
Okay, guys, before you come after me swinging tomahawks, let me disclose: I have holdings in AMP. I also have a sense of humor. Full disclosure. So lighten up a little, all right? How can we hang out if you're gonna be all the time? So, we're cool, right? Okay, let's get into it.
VISA's Crypto Entry
Earlier this year, in March, Reuters published an exclusive story, that Visa Inc was going to allow the use of the USD stablecoin to settle transactions on its payment network. This initiative was dubbed a pilot program on the crypto platform, Crypto.com, and at the time, Visa had confirmed that it planned to offer the option to more partners later in the year.
The move then was hailed as a sign of the "growing acceptance of digital currencies by the mainstream financial industry".
The Universal Payment Channel
On Thursday, September 30th, Visa unveiled its Universal Payment Channel, which it hopes will serve as an interoperable blockchain hub that can connect to multiple blockchain networks and enable transfers of different crypto from various protocols and wallets.
"Imagine splitting the check with your friends when everyone at the table is using a different type of money," Visa said in a blog. "Some using a central bank digital currency (or CBDC) like Sweden’s eKrona, and others preferring a private stablecoin like USDC. How about sending $500 in USDC to a friend in London, and having those funds automatically converted to digital British pounds before they arrive in her CBDC wallet? Now imagine all this happening in real-time, across multiple networks, and compatible with multiple digital wallets.??"
Sounds just about
Alchemy Pay describes itself as the world's first hybrid crypto and fiat payment gateway.
There is no disputing, however, the fact that Visa is the heavyweight in this fight, assuming there is even a fight, as it promises to connect central banks, businesses, and consumers to "seamlessly exchange value, no matter the form factor of the currency". And as to be expected, Visa means business, at once sharing its research paperpolicy guidance for central banks and regulators on the implication of their research.
Why Should This Development Matter?
Well, for one thing, Visa explains, even if digital currencies may not be a part of your financial life today, this is likely to change in the future as more and more central banks explore opportunities for the implementation of CBDCs. And the company seems committed to ensuring that this transition, should it occur, is successful by ensuring that tools are in place to assure a great consumer experience and widespread merchant acceptance.
As a crypto-enthusiast, I am always cheering on any positive development that shows the mainstream finance industry leaning into cryptocurrency, so from this perspective, I am pleased by Visa's news. My concern as an AMP holder is, how does Visa's proposal intersect with, complement or compete with use case as a decentralized finance application? Are there opportunities for partnership? If not, then what are the implications?
At the time of this post, AMP and ACH were trading at USD0.048 and USD 0.069 respectively.
I'd love to hear your views on this one guys.
Until the next one, be safe!
