VISA executives said that the integration of traditional payment cards with cryptocurrency trading products plays a crucial role in driving the adoption of digital assets.
Speaking to Cointelegraph reporter Ezra Reguerra during a panel discussion at the Dubai Blockchain Economic Summit, VISA Vice President of Innovation and Design Akshay Chopra highlighted the role that Visa cards have played in recent years as a bridge between fiat and cryptocurrencies.
Chopra said the use of cryptocurrencies as a means of payment for everyday items, such as a cup of coffee at a cafe, has not really taken off. To address this challenge, Visa is partnering with 75 of the largest cryptocurrency exchanges in 2021, allowing them to issue Visa cards.
This subsequently opens up a network of approximately 80 million Visa merchants that can expand to serve customers who prefer to use cryptocurrencies as a means of payment, as Chopra told Reguerra:
“Building this bridge in 2021 alone, and those numbers haven’t really been made public yet, facilitated $3 billion in payments.”
Chopra highlighted this as one of many opportunities for traditional financial institutions to tap into the broader Web3 ecosystem.
Related: Visa taps Solana to expand USDC payment capabilities
Payment settlement between financial institutions remains another avenue for disruption and innovation through blockchain-based solutions. Chopra said existing protocols such as the SWIFT payment system still have limitations, including the inability to function 24 hours a day:
“The bottom line is, there are trillions of dollars of transactions between banks, but there is a cut-off time when you simply can’t do international transactions. It’s a big pain point, and it’s costly and inefficient.
Akshay highlighted a pilot with Circle using USD Coin (USDC), enabling many cryptocurrency exchange partners to make payments using USDC at the end of the day:
“It’s cheaper than traditional methods, available 24/7 and innovative. You send your USDC balance and Visa holds the funds in escrow on the backend of the Ethereum blockchain.”
Regulation remains a barrier to mainstream financial institutions truly leveraging blockchain technology and cryptocurrency-based payments. However, Akshay believes that the regulatory environment in jurisdictions such as the United Arab Emirates (UAE) continues to improve.
Akshay believes that compared with passive supervision in countries such as the United States, active supervision methods are more beneficial to industry participants.
“When they set up the regulatory framework, they invited industry to tell the story of what it needs and what it will look like years from now, so that regulations can be developed in advance.”
Visa made headlines in April 2023 when it released a crypto product roadmap aimed at driving the adoption of stablecoins and public blockchain payments among mainstream financial institutions.
The company also plans to invest $100 million through Visa Ventures to explore innovative artificial intelligence products and solutions focused on payments and commerce.
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