Bitcoin, the most popular cryptocurrency coin, jumped to a one-week high on the news, rising as much as 4.5pc to $60,000 and heading back toward a record-high above $61,000 hit earlier this month after Visa announced that it will allow the use of the cryptocurrency USD Coin to settle transactions on its payment network.
USD Coin (USDC) is a stable coin cryptocurrency whose value is pegged directly to the U.S. dollar.
Talking to Reuters, the company said it had launched the pilot program with payment and crypto platform Crypto.com and planned to offer the option to more partners later this year.
“We see increasing demand from consumers across the world to be able to access, hold and use digital currencies and we’re seeing demand from our clients to be able to build products that provide that access for consumers,” Cuy Sheffield, head of crypto at Visa, said.
What this means is, traditionally, if a customer was using a Crypto.com Visa card to pay for a coffee, the digital currency held in their cryptocurrency wallet would need to be converted into traditional money to facilitate the purchase.
To achieve this, the cryptocurrency wallet would need to deposit traditional fiat currency in a bank account, which would then be sent to Visa at the end of the day to settle any transactions, adding cost and complexity.
Visa’s latest step, which will use the the Ethereum blockchain, strips out the need to convert digital coin into traditional money in order for the transaction to be settle.