Why did Visa not take the lead in supporting Bitcoin and chose a stablecoin?

Visa, a world-renowned payment platform, will only use USD stablecoin (USDC) as a payment and transaction method on its platform. 

More than a month ago, the platform announced that it would only accept USDC, instead of high-value cryptocurrencies such as Bitcoin and Ethereum, which are leading the market . 

So why is there only USDC?

First of all, Visa seems unwilling to participate in the violent wave of value fluctuations in the crypto market. This is true for more than 85% of cryptocurrencies, including Bitcoin. 

Visa prefers to use stablecoins for testing at a relatively stable level. USDC, as a type of stablecoin, is authorized by the federal government and has a huge amount of U.S. dollar reserves as statutory support. 

1619664070358720At the same time, the special reason that makes it the first choice for Visa is that its demand exceeds the $10 billion mark, and the reputable global financial company Grant Thorton guarantees safety for its regulatory compliance and routine audit inspections.

Visa has extensive experience in the field of encryption, however, it does not intend to complete this work alone. Instead, it cooperates with Crypto.com, the world’s largest crypto payment platform, to integrate two APIs for fast and seamless crypto transaction conversion and settlement. .

Through this cooperation, Visa’s daily transactions will increase by more than 70% on the basis of the billions of transactions currently processed. The two companies have launched several types of Crypto Visa cards that can be recognized and paid on various sales platforms for various daily uses.

Visa CEO Al Kelly said that the company hopes to develop four basic businesses in the crypto field : becoming a major participant in the crypto asset payment and purchasing community; helping traditional banks create APIs that connect the crypto market; and proposing more stable solutions; Accelerate the establishment and acceptance of central bank Crypto currency . 

Given that CBDC is still in the iterative stage, it is not clear what form this Crypto currency will ultimately take. Compared with the large number of cryptocurrencies already in the market, what advantages it may have?

However, one thing is certain is that for overly cautious investors, CBDC will guarantee a form of centralization that can ensure asset safety and cushion volatility, unlike cryptocurrencies.

1619664070358186However, when these government-backed cryptocurrencies are finally released, they will eventually have to be stored in Crypto wallets that are susceptible to Internet failures or equipment power outages, thereby inhibiting transactions and making them less efficient than paper money.

Proponents of innovation boast that NFC and Bluetooth are ready-made methods for offline transactions, but there are still problems with the security and protection of assets. 

The only obvious advantage is the support of regulators. CBDC seems to be more effective than traditional banknotes and decentralized cryptocurrencies in this race.

Obviously, Visa has shown that its development trajectory in the world of crypto assets is diverse, and it hopes to stand on the side of the legitimacy of the central authority. Visa has no regrets about the losses from the billions of transaction fees accumulated per second from all other cryptocurrencies that account for 99% of the market. 

However, for Bitcoin, Visa’s neglect is just a ketchup stain on its pure white reputation, and it will not destroy its reputation based on consensus and consistency . 

Frankly speaking, these two industry giants can take care of and develop themselves well.

Leave a Reply
Related Posts

Wall Street elites “flock” to Web3

Web3, is continuously and violently impacting the US financial system. On February 16, a regulatory filing by the NYSE to the USPTO was made public. It wants to build a “cryptocurrency and NFT exchange” and compete with Web3 companies like OpenSea. OpenSea, an NFT…
Read More