Visa Inc. announced that its payment network will use a “stable coin” that will be backed by the United States dollar in settling transactions signaling the acceptance of blockchain technology in the mainstream economic system. The trend could be the biggest change to the payments industry in decades.
Visa will be launching a pilot program that will use the USD Coin to settle transactions over Ethereum with help from Anchorage, a digital asset bank. The service will be offered to more partners later in the year, but will start with Crypto.com and Anchorage. Bitcoin increased by more than 6% after a slight sell off last week taking the digital currency back up beyond $58,000.
The entire Crypto Currency market advanced with the news. Just one year ago, Wall Street analysts were claiming Bitcoin was overheated when it was trading at a fraction of what it is today.
Financial companies are adopting cryptocurrencies and blockchain with momentum that seems to signal mainstream usage is closer than analysts had expected. While many Wall Street executives still claim that it is simply a speculative market, financial institutions continue to invest.
Visa Chief Product Officer Jack Forestell explained that the move was focused on financial technology firms. “Crypto-native fintechs want partners who understand their business and the complexities of digital currency. The announcement today marks a major milestone in our ability to address the needs of fintechs.”