Visa has announced a new platform to help banks issue and manage fiat-backed tokens on blockchain networks, with BBVA set to pilot the platform by 2025.
Global payment network Visa has unveiled a blockchain-based platform to help financial institutions integrate fiat-backed tokens, aiming to bridge traditional banking and blockchain technology.
In an Oct. 3 press release, Visa said the so-called Visa Tokenized Asset Platform will enable financial institutions to mint, burn, and transfer tokens backed by fiat currencies, such as stablecoins, with BBVA, a Spanish multinational banking giant, set to pilot the technology on the public Ethereum (ETH) blockchain in 2025.
Visa says the VTAP solution integrates with existing banking infrastructure via APIs, allowing banks to explore tokenization use cases within a sandbox environment. The platform’s programmability also enables financial institutions to automate processes, such as “administering complex lines of credit using smart contracts and use fiat-backed tokens to release payments when payment terms are met.”
“We’re excited to leverage our experience with tokenization to help banks integrate blockchain technologies into their operations.”
Vanessa Colella, global head of innovation and digital partnerships, Visa
Per the press release, BBVA has been testing the platform throughout 2024, focusing on token issuance, transfer, and redemption on testnet blockchains. However, it is unclear when exactly the Spanish giant plans on piloting the platform. Visa says its platform is designed to support interoperability across multiple blockchain networks, though it is unclear what other networks are in line for support.
Visa raises concerns over stablecoin adoption
Earlier in May, Visa unveiled a study challenging the assumption that stablecoin transactions are approaching volumes seen in traditional payment networks. Cuy Sheffield, Visa’s head of crypto, noted that a significant portion of stablecoin activity is driven by automated bot transactions, rather than genuine usage.
The findings, however, sparked debate, with some industry participants questioning Visa’s methodology. While Visa remains cautious about stablecoin adoption, others argue that stablecoins are still in a nascent stage and should not be dismissed based on current data.
From: crypto.news
Crypto News
