Visa Launches Layer 2 Payment Solution for CBDCs and Stablecoins
Visa, a credit card giant firm, has been making great strides in crypto adoption. The firm has now announced that its research and product team is working towards a new blockchain project dubbed Universal Payment Channel (UPC).
The announcement made on September 30 by the Global CBDC Product Lead at Visa, Catherine Gu, stated that UPC would be a cross-chain interoperability platform that will bring together different Decentralized Ledger Technology (DLT) networks and make the transfer of digital assets easy and convenient.
“Think of it as a “universal adapter” among blockchains, allowing central banks, businesses and consumers to exchange value seamlessly, no matter the form factor of the currency,” Gu stated.
Visa and Crypto
Visa is among the global payment giant firms that have fully embraced digital currencies. In the recent announcement, Visa stated that it is confident that more central bank digital currencies (CBDCs) will be developed. It also noted that even if the US is lagging in CBDC development, a digital dollar will still be launched.
The UPC hub will link CBDCs and stablecoins under one cross-chain platform to enable seamless transfers. It will also allow interoperability between the CBDC networks of different countries and trusted private stablecoin networks.
Gu also noted that Visa’s product would offer certain advantages such as high speeds in transaction processing. UPC hub will be based on layer two, whereby transactions will be processed off-chain. It will also leverage smart contracts to enable communication between blockchains and offer security and reliability.
Gu also added that the hub will be “adding value to multiple forms of money movement, whether they originate on the Visa network, or beyond.”
However, the announcement failed to mention whether the network would support other digital currencies like Bitcoin and Ethereum. Nevertheless, Visa has been positive towards Bitcoin, as early this year, the payment giant said Bitcoin was the digital gold.
Credit Cards and Crypto
Credit cards have become popular in the crypto sector as they facilitate easy conversion of crypto assets into fiat. On September 30, COTI, a renowned blockchain payments fintech firm, stated that it would launch Visa debit cards for clients and support bank accounts.
This move is geared towards bridging the gap between digital currencies and fiat currencies, as it will allow users to use both crypto and fiat seamlessly when shopping online or in-store.
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