Visa to launch central blockchain system for digital currencies

Visa has said it is working on launching a central blockchain system for digital currencies.

The firm said the system which will be called the Universal Payment Channel, would integrate different blockchain networks and connect different Central Bank Digital Currency (CBDC) networks across the world. 

According to the payment company, “While digital currencies may not be a part of your daily financial life today, it’s likely that they will play an important role in the future. 

“Over the past two years, central banks around the world have shown an increasing interest in exploring CBDC — a new, digital form of central bank money that can be used directly by consumers, merchants, and financial institutions. 

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“In the coming years, many central banks will likely implement some form of a digital ledger. Central banks will select the tech stacks and design protocols that make the most sense for their constituents, taking factors like governance, market requirements, technology providers, compliance standards, and nation-specific priorities into consideration.”

“As the number of digital currency networks increases — each with unique design characteristics — the likelihood that consumers, businesses, and merchants are transacting on the same network and utilizing the same type of money decreases. 

“We believe that for CBDCs to be successful, they must have two essential ingredients: a great consumer experience and widespread merchant acceptance. It means the ability to make and receive payments, regardless of currency, channel, or form factor. And that’s where Visa’s UPC concept comes in.” 

The payment company said its Universal Payment  Channel hub would establish dedicated payment channels that will connect different blockchain networks, connecting CBDC networks between countries and connecting CBDC networks with vetted private stable coin networks. 

According to Visa, its central blockchain system for digital currencies – Universal Payment Channel – will increase digital currencies transaction speeds making CBDC useful and attractive for consumers and businesses globally.