Visa moves to settle transactions using cryptocurrency

Financial Services giant, Visa, has become the first payment network to settle transactions using cryptocurrency. The company announced that it is moving to the use of USD Coin (USDC), a stablecoin backed by the US dollar, to settle a transaction with Visa over Ethereum—one of the most actively used open-source blockchains.

Visa is piloting the capability with Crypto.com, a Visa partner and one of the world’s largest crypto platforms, and plans to offer the USDC settlement capability to additional partners later this year.

This is the latest sign of growing acceptance of digital currencies by the mainstream financial industry.

Just last week, Tesla boss, Elon Musk, stated that you could now buy a Tesla with bitcoin.

Bloomberg reported that Bitcoin and other cryptocurrencies rose after the news about Visa Inc. Bitcoin jumped by as much as 6.3% during the European session to climb back above $58,000.

Visa says it has spent the last year establishing a pathway for digital currency settlement within Visa’s existing treasury infrastructure, a platform that moves billions of dollars each day across thousands of institutions in more than 200 markets and 160 currencies. Working with Anchorage, the first federally chartered digital asset bank and an exclusive Visa digital currency settlement partner, Visa has launched a pilot that allows Crypto.com to send USDC to Visa to settle a portion of its obligations for the Crypto.com Visa card program.

Visa’s standard settlement process requires partners to settle in a traditional fiat currency, which can add cost and complexity for businesses built with digital currencies. 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. Visa’s treasury upgrades and integration with Anchorage also strengthen Visa’s ability to directly support new central bank digital currency (CBDC) as they emerge in the future.

“Crypto-native fintechs want partners who understand their business and the complexities of digital currency form factors,” said Jack Forestell, executive vice president and chief product officer, Visa. “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 said: “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.”

“Anchorage’s platform has been purposefully built for institutions like Visa to build new products in crypto. We’ve been with Visa every step of the way since 2019 and are extremely pleased to see these first stablecoin payment rails come to life through Anchorage APIs,” said Diogo Mónica, Co-Founder and President of Anchorage.

David Puth, CEO of Centre, which oversees the licensing of USDC, said: “Visa is leading the market with its innovative approach to payments in many forms. We are very impressed with their efforts. Having USDC on the Visa network is an outstanding next step in our mission to connect the world using stablecoins built on Centre standards, starting with USDC.”