VISA has just developed a new protocol, still in the concept phase, that shows how various MNBCs (central bank digital currencies) could become interoperable. The company has also deployed its first-ever example of a smart contract on the Ropsten network, the Ethereum (ETH) testnet.
An interoperability project well underway
VISA shares some new thinking on interoperability in crypto within a document, published directly on their website. The payments giant is taking another step towards digital currency adoption. It has developed a concept that shows how different MNBCs can be interoperable with each other to make payments.
The concept, called the Universal Payment Channel (UPC) describes how various blockchain networks can be interconnected to enable the transfer of MNBCs. It shows how VISA can help exchange various MNBCs built on different blockchains in the future.
“This is a concept for much longer term future thinking about how VISA could potentially help become a bridge between a digital currency on one blockchain and another digital currency on another blockchain.”Statement from Cuy Sheffield, Head of Crypto at VISA
For digital currencies to be successful, VISA believes they must offer a great experience for consumers. Most importantly, there must be widespread acceptance by merchants. To do this, it must be possible to make and receive payments, regardless of currency, channel or form factor. This is where VISA’s UPC concept comes in.
UPC is a conceptual protocol that facilitates payments in digital currencies between different parties.
“The UPC protocol facilitates payments through an entity, called the UPC hub (or server – we use the terms interchangeably), which acts as a gateway to receive payments and route them to registered recipients.”
VISA’s first smart contract
As part of the development of the UPC concept, VISA has also deployed its first-ever example of a smart contract on the Ropsten network, the Ethereum testnet. The smart contract shows a payment channel that accepts both Ethereum (ETH) and Circle’s USDC stablecoin.
“UPC’s dedicated payment channels would be built on the blockchain and leverage smart contracts to communicate with the various blockchain networks, providing high transaction throughput in a secure and reliable manner, and improving overall speeds.”VISA release
The company is increasing its knowledge and expertise, learning strength and writing smart contracts on Ethereum. It will also explore other blockchains in the future. Ultimately, Visa says it aims for UPC to serve as a “network of blockchain networks” to move digital currency.
In a live video on YouTube, soberly titled “VISA Creates Universal Payments Network on Ethereum,” the entire presentation of the project can be found.
The company regularly reaffirms its commitment to expanding its crypto offering. In 2020, by partnering with Circle, VISA had announced support for USDC stablecoin on select credit cards. More recently, the payments giant was making a big splash this summer, when the company made news, buying its first CryptoPunk for $165,000.