Crypto Cards Drive $3 Billion in Payment Volume through 2021 Exchange Deals, Says Visa Executive

In a recent conversation, Akshay Chopra, Visa’s vice president and head of innovation and design, shed light on the pivotal role Visa has played in integrating traditional payment cards with cryptocurrency exchanges. This integration, Chopra emphasized, has significantly contributed to the widespread adoption of digital assets.

Chopra acknowledged that despite the growing popularity of cryptocurrencies, their everyday usage for mundane transactions, like buying a cup of coffee, is not yet commonplace. To bridge this gap, Visa collaborated with 75 major cryptocurrency exchanges in 2021, enabling them to issue Visa cards. This strategic move seamlessly connected around 80 million Visa merchants with customers inclined towards using cryptocurrencies for payments. According to Chopra, this initiative alone facilitated an impressive $3 billion in payment volume, although these figures were not widely publicized.

This collaboration between Visa and cryptocurrency exchanges not only expanded the scope of digital payments but also highlighted the potential for traditional financial institutions to participate in the wider Web3 ecosystem. Chopra pointed out that there are several untapped opportunities for innovation, one of which is the disruption of payment settlements between financial institutions.

Existing payment settlement protocols, such as the SWIFT system, have limitations, including operational constraints within specified hours. To address this challenge, Visa conducted a pilot project with Circle using USD Coin (USDC). This initiative allowed various cryptocurrency exchange partners to settle payments using USDC, providing a more cost-effective and efficient alternative that operates 24/7. In this innovative process, the USDC balance is sent, and Visa custodies the funds on the Ethereum blockchain.

However, regulatory hurdles have posed challenges for mainstream financial institutions looking to leverage blockchain technology and cryptocurrency-based payments. Chopra noted that progressive regulatory environments, as seen in jurisdictions like the United Arab Emirates, have significantly benefited industry participants. In these regions, regulatory frameworks were developed collaboratively with industry input, allowing for a clearer understanding of future needs and paving the way for proactive and well-thought-out regulations.

Visa made significant strides in the crypto space in April 2023 with the launch of a comprehensive crypto product roadmap. This strategic initiative aims to drive the widespread adoption of stablecoins and public blockchain payments among mainstream financial institutions. Additionally, Visa announced a substantial investment of $100 million to explore cutting-edge artificial intelligence-powered products and solutions. This investment, facilitated through Visa Ventures, is geared towards innovations in the realm of payments and commerce, marking yet another step in Visa’s commitment to shaping the future of digital transactions.

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