14.07.2024

Visa adds support for USD Coin cryptocurrency on Ethereum blockchain to its system

Visa has announced support for the USD Coin stablecoin for transactions on its network. In a test earlier this month, Crypto.com sent a USDC transfer to Visa’s Ethereum Anchorage address.

According to yesterday’s announcement, Visa’s use of the Ethereum blockchain removes the need to convert digital assets into fiat money before a transaction can take place. And this saves the business from the difficulties that were relevant before.

Visa officials said the company will partner with Crypto.com platform to offer a crypto settlement system for fiat transactions later this year. It is reported that Visa partners will be able to exchange USDC stablecoin through the Visa payment network. So far, the standard settlement process requires partners to send regular currency by wire transfer, which «could add cost and complexity for businesses heavily using digital currencies.»

Note that USDC or USD Coin is not the most popular stablecoin Tether USDT, but another cryptocurrency. Its creator is Circle, and the coin itself is available on three blockchains. This is Ethereum with ERC20 tokens, ASA on Algorand and SPL tokens on the Solana network.

We checked the actual data: USDC is now the second most common stablecoin. Its share in the niche of coins pegged to the value of the dollar is 17.46 percent. At the same time, the industry leader – Tether USDT – holds 68.61 percent.

stablecoins table

All-time stablecoin share graph

However, it is important to note here that the market situation is changing. Three months ago, USDC and USDT accounted for 13.4 percent and 77.07 percent of the niche, respectively. That is, while the situation is changing in favor of the USDC. And the current Visa initiative will only add reputation points to this cryptocurrency.

Visa and cryptocurrency support

The news was commented on by the head of the cryptocurrency department at Visa Kai Sheffield. Here is a quote from a company representative in which he spoke about what is happening. The cue is from Decrypt.

We see a growing demand from consumers around the world for the ability to access, store and use digital currencies. The same applies to our customers in terms of creating products that provide such access to consumers.

That is, company representatives noticed the demand of users in many countries for the use of cryptocurrencies. Moreover, we believe that in this case we are talking about less tech-savvy people who have not yet had time to figure out the principle of interaction with crypto-exchanges. They want to purchase and manage coins using standard solutions – including from a popular bank card issuer.

USDC cryptocurrency chart

Growth of USDC capitalization over the last year

Part of this growing demand is visible in South America, where consumers want access to cryptocurrencies not only as insurance against inflation of national currencies, but also as a means of spending. According to a Visa poll last month, 25 percent of all credit card users on the continent would like to experiment with cryptocurrencies if payment processors gave them the opportunity.

Cryptocurrency is becoming an important part of global business and even traditional payment systems. Recall that last year, the PayPal platform announced support for Bitcoin and altcoins in its system, which subsequently caused an explosive growth in the crypto market.

Thanks to this, users of the platform were able to purchase certain coins and earn on jumps in their value. And although it is impossible to withdraw crypto to third-party wallets, less experienced PayPal customers still got the opportunity to join the growth stage of the blockchain asset market.

Finally, the day before, Elon Musk announced his readiness to accept BTC. That is, now US residents can pay for new Tesla cars using bitcoins. A similar opportunity for citizens of other countries will appear before the end of this year.

tesla bitcoin cryptocurrencies

Pay with Bitcoin on the Tesla website

We believe that this decision by Visa’s management was another step towards the massive adoption of cryptocurrencies around the world. Blockchain assets have proven their promise, so now global companies are gradually joining the trend. And since they are just starting to do this, the niche itself is at the initial stage of its development. So further we are waiting for new announcements from giants from different spheres.

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