Transnational payment company Visa has developed a concept product showing the possibilities of using various CBDCs (Central Bank Digital Currencies) to make payments.
Visa proposes to connect various blockchains in a single second-tier network in order to simplify payments using such tools, as well as their exchange with each other.
A new concept called the Universal Payments Channel (UPC) is a protocol that simplifies digital currency payments between counterparties. It demonstrates Visa’s future ability to exchange CBDC and stablecoins built on different blockchains. More details about all the features of the new product can be found in the white paper of the project.
- Visa has unveiled the UPC protocol demonstrating the interoperability between various CBDCs and stablecoins.
- In the future, UPC will allow merchants to accept cryptocurrencies based on various blockchains as payment without any problems.
- The company has deployed its first smart contract on the Ethereum Ropsten network.
Visa believes that cryptocurrencies, including CBDC and stablecoins, will take their place in people’s lives in the future, but for this they must be useful in terms of consumption and must be accepted by sellers. To achieve the latter, it is necessary to ensure the possibility of receiving payments regardless of currency, blockchain, communication channel and other factors – this is the direction in which Visa’s UPC works.
“This is a fairly long-term project with which Visa has the potential to become a bridge between one digital currency on one blockchain and another digital currency on another blockchain,” Kai Sheffield, head of Visa’s cryptocurrency division, told The Block.
As part of the UPC, Visa has already deployed its first smart contract on the Ethereum Ropsten network. The new contract is a payment channel that accepts both ETH and USDC stablecoin.
According to Kai Sheffield, the company is still accumulating knowledge and experience and is learning to write smart contracts on Ethereum, but other blockchains will be explored in the future. Ultimately, Visa wants the UPC to become a “blockchain network” used to move various digital currencies.