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Visa working on blockchain interoperability hub for crypto payments

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Visa working on blockchain interoperability hub. Visa has developed a solution concept for the interaction of central bank digital currencies (CBDC) issued on different blockchains and stablecoins in payments.

According to the blog post, the Universal Payments Channel (UPC) platform acts as a hub. Which is combining several networks and ensuring the secure transfer of digital currencies.

“Think of it as a ‘universal adapter’ for blockchains, allowing central banks, businesses and consumers to seamlessly exchange value, regardless of the form factor of the currency”. Said Catherine Gu, Visa’s head of global products for CBDC.

Excellent user perception and broad acceptance by merchants

According to the company’s researchers, many central banks will issue digital currencies in the coming years. Due to the unique design features, it is unlikely that these assets can be freely operated on the same network.

“For CBDCs to be successful, they must have two main ingredients: excellent user perception and broad acceptance by merchants. This means the ability to make and receive payments regardless of the currency, channel or form factor,” Gu added.

The UPC hub will connect various blockchains. Whether it’s CBDC networks between countries or private stable coin protocols.

UPC solves the problem of bandwidth

Visa specialists noted that UPC also solves the problem of bandwidth. Since most DLT networks are significantly inferior in this indicator to traditional solutions. To ensure speed, UPC’s specialized payment channels will operate outside the blockchain and use smart contracts to provide feedback to it.

The researchers have already deployed a basic contract in the Ethereum Ropsten test network. They have been working on UPC since 2018.

Earlier, Visa offered a method of offline payments in CBDC. Representatives of the company were part of a group of experts who will help the UK authorities in studying the digital currency of the central bank.

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