Visa has announced a major industry breakthrough. The payments technology company is bridging the worlds of digital and fiat currencies by using USD Coin (USDC) to settle a transaction with Crypto.com in a pilot test designed in partnership with Anchorage.
The company plans to offer the USDC settlement capability to additional partners later this year.
Visa has spent the last year establishing a pathway for digital currency settlement and worked with digital asset bank Anchorage to launch a pilot that allows Crypto.com to send USDC to Visa to settle a portion of its obligations.
The ability to settle in USDC can ultimately help Crypto.com and other crypto native companies evaluate fundamentally new business models without the need for traditional fiat in their treasury and settlement workflows.
This upgrade also means Visa is now able to directly support central bank digital currencies (CBDC), which are expected to be launched in the near future.
Jack Forestell, executive vice president and chief product officer, Visa, said: “Crypto-native fintechs want partners who understand their business and the complexities of digital currency form factors. The announcement today marks a major milestone in our ability to address the needs of fintechs managing their business in a stablecoin or cryptocurrency, and it’s really an extension of what we do every day, securely facilitating payments in all different currencies all across the world.”
Kris Marszalek, Co-founder and CEO of Crypto.com, commented: “We’ve seen record-breaking growth in our business and the broader crypto ecosystem over the last year. To continue accelerating the world’s transition to cryptocurrency, we need partners who understand the opportunity and the tools that will help us get to market faster and more efficiently. Having been a Visa partner for several years, we’re excited to deepen that relationship through our global agreement and to pioneer an exciting world-first in stablecoin payments.”
USD Coin was launched in 2018 by Circle and Coinbase. The stablecoin technology and network scheme was created to establish a standard for fiat on the internet and providing a governance framework and network for the global, mainstream adoption of fiat stablecoins.
As a result of the common vision of an open global financial system built on crypto rails and blockchain infrastructure, as well as the need to build interoperable protocols and standards needed for fiat to work over the open internet, CENTRE launched USD Coin as its first major initiative.
Paypal is reportedly about to allow U.S. consumers to use their cryptocurrency holdings to pay at millions of its online merchants globally. The move could significantly boost the use of digital assets in everyday commerce.
PayPal digital wallets will allow cryptocurrencies to be converted into fiat currencies at checkouts to make purchases, and the service will be available at all of its 29 million merchants in the coming months, Reuters reported.