Visa has enabled the direct acceptance of USD Coin (USDC), a stablecoin backed by the US dollar, for settling transactions on its network.
This capability, which Visa is piloting with crypto platform and its partner Crypto.com, is said to make Visa the first major payment network to settle payments in USDC.
Plans are on to extend the USDC settlement capability to more partners later in 2021.
Crypto.com co-founder and CEO Kris Marszalek said: “We’ve seen record-breaking growth in our business and the broader crypto ecosystem over the last year. To continue accelerating the world’s transition to cryptocurrency, we need partners who understand the opportunity and the tools that will help us get to market faster and more efficiently.
“Having been a Visa partner for several years, we’re excited to deepen that relationship through our global agreement and to pioneer an exciting world-first in stablecoin payments.”
The capability, which is the result of Visa’s collaboration with digital asset bank Anchorage, will use the Ethereum blockchain.
As a result of the new capability, Crypto.com Visa card holders no longer have to convert crypto to fiat money to settle the payment.
Now, they can send USDC to Visa’s Ethereum wallet address at Anchorage for transaction settlement, thereby reducing the complexity for businesses.
Visa believes that the use of USDC for settling payments could help crypto native companies to explore new business models without the need for fiat in treasury and settlement workflows.
The card giant’s treasury upgrades and integration with Anchorage is also said to bolster its ability to directly support new central bank digital currency (CBDC).
Visa executive vice president and chief product officer Jack Forestell said: “The announcement today marks a major milestone in our ability to address the needs of fintechs managing their business in a stablecoin or cryptocurrency, and it’s really an extension of what we do every day, securely facilitating payments in all different currencies all across the world.”
Last month, Mastercard said that it will begin accepting select cryptocurrencies directly on its network starting later this year.