In a newly announced pilot, Visa said Tuesday it will begin sending USDC, the second-largest stablecoin by market capitalization, to select merchants via the Solana blockchain.
While credit card holders simply swipe or tap to buy something, Visa facilitates the complex payment process behind the scenes to enable each transaction. After the purchase, the cardholder’s bank wires the money to Visa’s vault, from which Visa withdraws the funds and sends them to the merchant’s bank.
This is usually done with fiat currency, but the payments giant has previously allowed companies, most of them crypto-native, such as encrypted networksending payments to its treasury via USDC, the dollar-backed stablecoin issued by Circle.
Visas with dedicated accounts at Circle will now start sending USDC go out Transfers its funds to two large payment companies – WorldPay and Nuvei – which in turn can directly facilitate payments for merchants. The companies decided to send and receive USDC on Solana because the blockchain is able to process conversions faster than Ethereum.
“The expanded pilot demonstrates how the combination of USDC and Visa innovations can unlock the future of payments, commerce and financial applications,” Circle co-founder and CEO Jeremy Allaire said in a statement.
Cuy Sheffield, head of cryptocurrency at Visa, said that while stablecoins promise to speed up bank transfers, processing times for transferring funds into or out of vaults will remain the same. wealth.
“At this early stage, we’re really just offering the option to send or receive USDC, not bank wire, but we’re not necessarily going to send funds faster or receive funds faster,” he said in an interview. Over time, I think it’s possible to start doing that.”
The expansion of Visa’s USDC settlement process is yet another new crypto product or pilot launched by traditional payment companies this year, despite the federal government’s continued broad regulatory action against the crypto industry.
In February, the SEC released wales notification, or a legal document indicating that the agency intends to sue a company against stablecoin issuer Paxos. PayPal, which worked with Paxos to develop its own stablecoin, said it was “pausing” development amid regulatory scrutiny. However, in August, the publicly traded payments company did launch its stablecoin.
Mastercard has also launched a new suite of crypto products, most recently the so-called Multi-Token Network (MTN). But just a few months later, Mastercard confirmed it was ending its partnership with Binance on a prepaid crypto debit card after the US Securities and Exchange Commission (SEC) sued the world’s largest cryptocurrency exchange in June. relation.
A spokesperson for Visa also said comfirmed The company stopped issuing Binance cards in Europe this summer, while Sheffield, Visa’s head of cryptocurrency, declined to comment. wealth On whether the payments company plans to cut ties with Binance entirely.
That being said, Visa’s latest pilot suggests that the company isn’t cutting ties with cryptocurrencies, especially stablecoins, anytime soon. “We’ve recognized that stablecoins can play a role in payments,” Sheffield said. wealth“They can solve real challenges.”
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