- VISA is testing stablecoin settlement on its payments network.
- The payments giant wants to shift from the SWIFT network.
- The company is using the Ethereum network to test settlement.
VISA Inc, one of the biggest payment processing firms in the world, has begun experimenting with stablecoin settlements on their network. The CEO of VISA’s crypto department, Cuy Sheffield, confirmed the development during the StarkWare Sessions 2023.
Sheffield claims that VISA plans to implement a feature that would enable consumers to convert digital assets to fiat currency on its platform to help them develop “muscle memory” regarding settlements.
Sheffield says that the payment giant has been restricted in transmitting funds as frequently as possible since settlements are still handled through the Society for Worldwide Interbank Financial Telecommunications (SWIFT) system.
To overcome this barrier, VISA has tested the feasibility of accepting settlement payments made using stablecoins on the Ethereum blockchain. The crypto division head was quoted saying:
We’ve been testing how to actually accept settlement payments from issuers in USDC starting on Ethereum and paying out in USDC on Ethereum. So, these are large value settlement payments.
In a proposal made last year, VISA advocated implementing programmable, automatic payments on Ethereum using a technology called “account abstraction.” VISA stated that this move would pave the way for recurring payments to be processed fully through blockchain networks. The firm recommended deploying the system on Ethereum‘s layer 2 network, StarkNet.
Furthermore, the former CEO of VISA, Al Kelly, recently spoke at the company’s annual shareholder meeting, where he briefly discussed VISA’s ambitions for central bank digital currencies (CBDCs) and private stablecoins, saying, “stablecoins and central bank digital currencies have the potential to play a meaningful role in the payments space, and we have a number of initiatives underway.”
Meanwhile, Sheffield reaffirmed the company’s position on blockchain technology and digital assets. He noted that the firm is seriously considering replicating some of VISA’s value “on top of blockchain rails,” using existing beyond forms and “stable boards.”
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