Visa Inc said on Monday it would allow the use of the cryptocurrency USD Coin to settle transactions on its payment network, the latest sign of growing acceptance of digital currencies by the mainstream financial industry.
Visa has launched the pilot program with payment and crypto platform Crypto.com and plans to offer the option to more partners later this year, it said.
The USD Coin (USDC) is a stable coin cryptocurrency whose value is pegged directly to the US dollar.
Visa’s move comes as major financial firms including BNY Mellon, BlackRock Inc, and Mastercard Inc have embraced some digital coins, sparking predictions that cryptocurrencies will become a regular part investment portfolios.
Last week, Tesla Inc boss Elon Musk said that customers could buy its electric vehicles with bitcoin, marking a significant step forward for the cryptocurrency’s use in commerce.
“We see increasing demand from consumers across the world to be able to access, hold and use digital currencies, and we’re seeing demand from our clients to be able to build products that provide that access for consumers,” Cuy Sheffield, head of the crypto at Visa, said.
Traditionally, if a customer chooses to use a Crypto.com Visa card to pay for a coffee, the digital currency held in a cryptocurrency wallet needs to be converted into traditional money.
The cryptocurrency wallet will deposit traditional fiat currency in a bank account to be wired to Visa at the end of the day to settle any transactions, adding cost and complexity for businesses.
Visa’s latest step, which will use the ethereum blockchain, strips out the need to convert digital coins into traditional money to settle the transaction.
Visa said it has partnered with digital asset bank Anchorage and completed the first transaction this month — with Crypto.com sending USDC to Visa’s Ethereum address at Anchorage.
