Visa and Consensys bridge CBDC and traditional networks

MNBC

Payment giant Visa has just found a new partner, Consensys, with whom it hopes to establish itself as a key reference in the CBDC market. This association represents a new step in an already well advanced strategy on the part of Visa not to be disrupted by the ongoing innovation in the payment world.

CBDC: A long-term project

  • Cryptographic software developer Consensys is now a Visa partner. Their joint work will focus on creating a bridge between existing payment networks and CBDC networks.
  • The goal is to develop a new infrastructure capable of helping central banks and traditional financial institutions to come together in a single interoperable space, to create simple and connected services between the two networks.
  • These services could, for example, take the form of a wallet or a payment card.
  • Visa and Consensys are currently consulting with central banks around the world to validate this model.
  • The new infrastructure from Visa and Consensys is expected to be available next spring.

A step ahead for Visa

  • A step ahead: The whole point of this merger between Visa and Consensys is also to stay ahead of its main historical competitor: MasterCard. MasterCard and Consensys had announced a collaboration last December, and Visa’s announcement is now a response to that.
  • Taking it to the next level: In October 2021, Visa said it wanted to take charge of crypto-currency interoperability. At the time, it was banking on a concept developed by its teams and called “Universal Payment Channel” (UPC), to create bridges between Central Banks’ Digital Currencies, in order to promote the interoperability of chains. Today, it is between CBDC and traditional payment networks that Visa is committed to creating bridges, raising its ambitions on the subject even higher.

Putting it into perspective

  • This is not Visa’s first venture into the CBDC and crypto-currency market. The payment giant posed as an expert in the sector last December, when the group revealed the new outline of its ambitions for Central Bank Digital Currencies in late 2020.
  • But crypto-currencies are not the only area of interest for Visa when it comes to new payment interfaces. Visa is also very interested in cloud-based solutions and last December presented a new platform, Visa Acceptance Cloud (VAC), which is supposed to revolutionize point-of-sale payments. It aims to enable acquirers, payment service providers, Point Of Sale (POS) system manufacturers, and Internet of Things (IoT) players to migrate their payment processing software, currently embedded in every hardware device, to the Cloud, to ensure universal accessibility.
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