Exclusive: Visa allows payment transactions with cryptocurrency

(Reuters) – Visa Inc said Monday it will allow the use of cryptocurrency USD Coin to settle transactions on its payments network, the latest sign of the mainstream finance industry’s growing acceptance of digital currencies.

The company told Reuters that it has started the pilot program with payments and crypto platform Crypto.com and plans to offer the option to additional partners later this year.

Bitcoin, the most popular crypto coin, jumped to a weekly high in the news, surging as much as 4.5% to $58,300 and returning to a record high of over $61,000 set earlier this month.

Visa subsequently confirmed the news in a statement.

USD Coin (USDC) is a stablecoin cryptocurrency whose value is directly pegged to the US dollar.

Visa’s move comes as financial firms like BNY Mellon, BlackRock Inc, and Mastercard Inc take steps to increase the use of cryptocurrencies for investment and payment purposes.

Tesla Inc. CEO Elon Musk, a big proponent of cryptocurrency, said last week that customers can buy its electric vehicles with bitcoin in hopes of encouraging everyday use of the digital currency.

“We are seeing increasing demand from consumers around the world to be able to access, hold and use digital currencies, and we see demand from our customers to be able to develop products that enable this consumer access,” Cuy Sheffield, Lead of Crypto at Visa, said.

Traditionally, when a customer uses a Crypto.com Visa card to pay for a coffee, the digital currency held in a cryptocurrency wallet must be converted to traditional money.

The cryptocurrency wallet will deposit traditional fiat currency into a bank account, which will be sent to Visa at the end of the day to process all transactions, adding cost and complexity for businesses.

Visa’s latest move, using the Ethereum blockchain, eliminates the need to convert digital coins into traditional money in order for the transaction to be processed.

Visa said it partnered with digital asset bank Anchorage and completed the first transaction this month — with Crypto.com sending USDC to Visa’s Ethereum address in Anchorage.

Reporting by Noor Zainab Hussain in Bengaluru; Adaptation by Saumyadeb Chakrabarty

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