/Visa joins the private race for virtual national currencies
Visa joins the private race for virtual national currencies

Visa joins the private race for virtual national currencies

Visa will join the elite of digital payment platforms, such as Mastercard, which are carrying out several individual pilot projects that aim to create applications for transactions with CBDC (English acronym for Central Bank Digital Currency), virtual currencies that replicate the exchange rate of a country’s fiat currency, such as the digital yuan.

The firm led by Alfred Kelly has signed a partnership with ConsenSys, a “blockchain” company, following a round of talks with around 30 central banks, including the Hong Kong Monetary Authority, the Reserve Bank of Australia and the Bank of Thailand.

“We think that stablecoins and CBDC will co-exist in the future and there will be a number of different approaches to building products based on this,” commented Cuy Sheffield, Head of Cryptocurrency at Visa.

Remember that the payments company already offers cards linked to USD Coin, a stablecoin issued by a consortium that includes Circle Internet Financial.

Two years ago, Mastercard launched a similar platform.

Nigeria and the Bahamas are among the nations that already circulate CBDCs, but the world protagonist in this matter, even if it is only in the testing phase, is China, which is preparing to boost the use of this asset en masse, during the Beijing Winter Olympics.

On the other side of the globe, in the nation of one of the main currencies in the world, the US started the “Hamilton” project, having studied the feasibility of creating a digital dollar.

At the end of last year, the US Federal Reserve (Fed) published a series of conclusions on the regulation and market participation of crypto-assets, where it mentions the project. It is expected that, in the coming weeks, a new report will be published with new advances on the subject.

In the euro area, studies are also underway on a virtual replica of the single European currency. The central bank is examining, together with the European Commission, “a wide range of policy, legal and design issues”, including the possible effects of awarding the euro digital legal tender status.

The European Central Bank (ECB) announced in July the launch of a two-year pilot project for the later introduction of the digital euro, conceived as a response to the increasing dematerialization of payments and the proliferation of cryptocurrencies.

“Nine months have passed since we published our report on the digital euro. In this time, we have carried out more in-depth analyses, asked for input from citizens and professionals and carried out experiments with encouraging results “, said ECB President Christine Lagarde at the time.

“All this led us to decide to accelerate and start the project of a digital euro”, he added.

Already Fabio Panetta, responsible for the specialized committee that is carrying out the project, assured at the end of last year in an interview with CNBC, that “the digital euro project is attractive and not redundant”, contrary to what he defends the more conservative wing of the ECB.

“Central bank money provides the benchmark for all other forms of payment in a region’s economy,” said Panetta. “History shows that financial stability and public trust in money require that currency be in the public domain,” he argued.

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