The decision to use the USDC on the Ethereum Blockchain for payments has made Visa’s intention clear. They are here to lead the worldwide crypto race.
Visa, the global payment industry behemoth, made an exciting announcement on Monday that they will be settling payments in USDC stablecoin in the Ethereum blockchain. With this announcement, Visa has become the first among the global payment giants to start settling payments in a cryptocurrency.
Partnership with Crypto.com
The payment settlement program that Visa is running is a part of a pilot program with Crypto.com. Under this partnership, Visa is letting Crypto.com manage the card business of Visa in its entirety.
Visa and Crypto.com have been partners for some time now. Under their previous agreement, Crypto.com had to settle the payments with Visa in fiat currencies. But it has changed now as Visa and Crypto.com have come to terms to allow Crypto.com for payment settlement in USDC.
The Role of Anchorage – A Crypto Bank
Anchorage, a popular crypto bank, has an important role to play in this pilot test between Crypto.com and Visa. They will be acting as the settlement agency providing USDC capability. Thus, Crypto.com will be sending USDC to the Ethereum address that Visa has at Anchorage.
Speaking on the relation that Visa has with Anchorage, its president, and co-founder, Diogo Mónica said:
“Visa came to us in 2019 with an idea—make secure, efficient, and seamless settlement payments possible in digital currency by linking Visa’s treasury with Anchorage’s custody platform.”
Expanding further, Mr. Diogo said:
“This would give the next generation of crypto native issuers the option to directly settle with Visa in a digital currency over a public blockchain.”
Reaction From Visa
Announcing their excitement on the historic moment of Visa being the first payments company to settle payments in a cryptocurrency, Jack Forestell, Visa’s Chief Product Officer said:
“The announcement today marks a major milestone in our ability to address the needs of fintech managing their business in a stablecoin or cryptocurrency.”
Connecting Visa’s role in the global payments industry with their decision to initiate payment settlement in USDC, Mr. Jack said:
“And it’s really an extension of what we do every day, securely facilitating payments in all different currencies all across the world.”
Reaction From Crypto.com
Crypto.com was equally excited with Visa’s decision to settle payments in USDC. Commenting on Visa’s pilot test with Crypto.com, Kris Marszalek, CEO & Co-Founder of Crypto.com said:
“Millions of consumers across the world access and use digital currencies,” and Visa’s capability to “directly accept and interact with digital currencies” helps enable it to maximize the benefits of digital currencies.”
As per Visa, the decision to settle payments in USDC may be one small step forward but it will act as a giant step for integrating digital assets in the mainstream.
If the pilot test returns satisfactory results, Visa will extend similar payment settlement options with their other partners as well. Visa plans to integrate CBDCs or Central Bank Digital Currencies for payment settlement eventually.
In fact, Alfred Kelly, CEO of Visa has talked about covering Bitcoin along with other major cryptocurrencies and stablecoins soon. Alike Visa, Mastercard too, aims to make a name for itself in the crypto and CBDC space. Both Visa and Mastercard are vying for dominance in the crypto space. It would be interesting to see how the competition unfolds in the coming days.