The leading card payments firm is in talks with central banks concerning a platform is designed to test CBDCs and Visa products
Visa joined its rival Mastercard in offering central banks a way to test retail applications for digital currencies they might issue.
The card payment provider will begin piloting a program this spring with ConsenSys, a blockchain software company, after discussions with roughly 30 central banks about goals related to government-backed digital currencies.
Visa announced on Thursday that it will expand its crypto services one step further by partnering with blockchain software company Consensys to build an on-ramp for central bank digital currencies (CBDC).
The payments giant aims to create a \u201cCBDC sandbox,\u201d available in the spring, where central banks can experiment with distributing the technology after minting on Consensys’ Quorum protocol.
The partnership is the latest development in the booming cryptocurrency market, with central banks vying to mint their own digital coins and established financial companies dabbling in crypto payments.
\u201cCentral banks are moving from research to actually wanting to have a tangible product they can experiment with,\u201d Chuy Sheffield, Visa\u2019s head of crypto.
CBDCs can run off distributed ledger or blockchain technology-built protocols. Unlike cryptocurrencies such as bitcoin (BTC-USD) or ether (ETH-USD), CBDC protocols are always “permissioned,” meaning central banks maintain monetary and governance control.
The partnership uses a \u201ctwo-tier\u201d distribution model for CBDCs. Central banks would design their digital currency on Consensys’ Quorum where they would set its monetary and governance rules. They then use Visa\u2019s infrastructure to distribute the currency via financial intermediaries like commercial banks.
Some of the advantages of the Visa-Consensys model include that it does not cut payment providers out of the equation, and could allow competition for who can provide the most efficient, low-cost services. Central banks will likely prefer to manage the payment infrastructure themselves.
Visa’s approach is also noteworthy for how it could help maintain the relevance of its payment network amidst fast-moving changes in the payment space that could undercut its business model. The changes also include stablecoins and various fintech payment platforms.<\/p>\n","protected":false},"excerpt":{"rendered":"
The leading card payments firm is in talks with central banks concerning a platform is designed to test CBDCs and Visa productsVisa joined its rival Mastercard in offering central banks a way to test retail applications for digital currencies they might issue.The card payment provider will begin piloting a program this spring with ConsenSys, a …<\/p>\n","protected":false},"author":13,"featured_media":55060,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[40,36],"tags":[7470,8528,6903,8527,8382,7337],"class_list":["post-58358","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-cryptocurrencies","category-market-updates","tag-central-banks","tag-crypto-platforms","tag-cryptocurrencies","tag-digital-currencies","tag-mastercard","tag-visa"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/58358","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=58358"}],"version-history":[{"count":2,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/58358\/revisions"}],"predecessor-version":[{"id":58362,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/58358\/revisions\/58362"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/55060"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=58358"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=58358"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=58358"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}