I hope you are all well and having excellent day, welcome to CryptoGod-1’s blog on all things crypto. The global payment giant Visa has announced its plans to expand into the world of stablecoin payments, and has plans to integrate with the Solana Blockchain to provide new services.
Visa & Solana
On the 5th of September 2023 VISA made the announcement that it will integrate with Solana and expand into the stablecoin payments sector. This is a huge move by VISA, who also announced its collaborations with prominent merchant banks, Worldpay and Nuvei.
The Head of Crypto at VISA, Cuy Sheffield, noted:
"By leveraging stablecoins like USDC and global blockchain networks like Solana and Ethereum, we're helping to improve the speed of cross-border settlement and providing a modern option for our clients to easily send or receive funds from Visa's treasury."
Cuy Sheffield also addressed some of the challenges which are associated with traditional Visa card transactions, such as the fact even though consumers experience a near instant payment transaction, the literal movement of funds behind the scenes can take longer to execute. It is VISA treasury and settlement systems which facilitate these transactions. These systems ensure that the efficient clearing, settlement, and transfer of funds between the consumer's bank (the issuer) and the merchant's bank (the acquirer) happens without any further requirement from the consumer.
This process and operation happens in a seamless way across a vast network comprising nearly 15,000 financial institutions and involving over 25 global currencies. This move towards stablecoins will see settlements transacted through the capability for VISA to transfer USDC-denominated payouts to Worldpay and Nuvei through its Circle Account.
The merchant banks will now be able to channel these payments in USDC to their end merchants, meaning Visa can now transmit funds on-chain to acquirers like Worldpay and Nuvei to ensure expedited settlement times for their associated merchants.
Back in 2021 VISA began to actively explore ways of enhancing its treasury operations. As part of this they began to test blockchain technology to receive funds from multiple issuer partners. They conducted a successful pilot project with CRYPTO.COM which made it one of the first major payment networks to test stablecoin settlement on the issuance side.
"Visa is committed to being on the forefront of digital currency and blockchain innovation and leveraging these new technologies to help improve the way we move money."
Cuy Sheffield went on to say in the X thread:
"This enables a modern and convenient option for crypto native issuers to more easily manage their card programs, helping reduce the time and complexity of managing multiple bank accounts and international wire transfers."
Prior to the pilot, the cross-border settlement for Crypto.com Visa card purchases was a time-consuming process which was also very costly thanks to currency conversions. These transaction settlements could often taking several days to complete.
By making use of USDC and blockchain technology, Crypto.com could send USDC across borders via the Ethereum Blockchain to a specific Visa Treasury account managed by Circle. This new process streamlined the previous one, and significantly reduced the time and complexity of international wire transfers.
Through its partnership with Crypto.com VISA has showed its commitment to exploring blockchain-based treasury solutions, while it has also managed to highlight the potential of stablecoins and blockchain to enhance efficiency in global payments.
With VISA making the move into facilitating efficient stablecoin transactions on the Solana Blockchain, the view of VISA as a leading pioneer among the major payment companies is growing. Solana will offer the ability for rapid settlement payments, with 400 millisecond block times, an average of 400 transactions per second (TPS), and the scalability to handle over 2,000 TPS during peak demand.
Visa has already successfully conducted live pilots by facilitating seamless USDC transfers across the Solana and Ethereum networks with the goal of playing a crucial role in settling fiat-denominated payments authorized via VisaNet.
"It's still early days, but Visa has already settled millions of dollars of USDC over the Ethereum and Solana blockchains between our clients."
Have a great day.
CryptoGod-1.
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