Visa Introduces Stablecoin Payment Solution in Latin America
Visa has unveiled a groundbreaking service that allows consumers in six Latin American countries, including Mexico and Argentina, to utilize stablecoins for everyday transactions. This innovative offering aims to tap into the burgeoning trend of digital currencies, facilitating easier transactions for both consumers and merchants.
Effortless Stablecoin Transactions in Local Currencies
Rubail Birwadker, Visa’s Senior Vice President, explained the practical application of the service using the example of a freelancer in Colombia who receives wages in US dollars. This individual can accept payments in stablecoins and use a Visa-branded card, be it physical or digital, to shop at local or online stores. The advantage of this system is its seamless integration; merchants receive payments in their local currencies instantly, making it as simple as any standard Visa transaction.
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Birwadker emphasized that many people in Latin America are already turning to stablecoins to protect against economic instability. He believes Visa’s new service will further legitimize their use in everyday transactions. “If you can figure out how to tie stablecoin spend with Visa’s off-ramp, that unlocks the case use,” he stated, underlining the potential for stablecoins to revolutionize financial transactions.
This initiative is not Visa’s first foray into the cryptocurrency sector. The company, alongside competitors like Mastercard, has previously provided its payment infrastructure to various cryptocurrency platforms, enabling users to spend Bitcoin (BTC) and other digital currencies.
Visa’s Collaboration with Bridge and the Use of USDC
The current launch is noteworthy because it focuses on stablecoins, which are designed to hold a stable value. The service will utilize Bridge’s technology, providing a versatile and open-ended approach to payment processing.
Founded by ex-Coinbase employees Zach Abrams and Sean Yu, Bridge aims to simplify the integration of stablecoins into financial applications. Acquired by Stripe for $1.1 billion, Bridge offers neutral APIs and technology, enabling the deployment of stablecoin solutions. By partnering with Bridge, Visa can extend its payment service to numerous third parties, allowing them to create their own consumer and merchant applications.
The primary stablecoin expected to be used is USDC, backed by Circle and Coinbase. However, Visa and Bridge plan to support additional stablecoins and various blockchain technologies in the future.
Abrams pointed out that this service will be particularly advantageous for businesses in regions with limited fintech infrastructure, enabling them to create financial products akin to popular apps like Chime or Cash App without needing extensive local financial networks.
Both companies expect to launch this stablecoin payment service in the six selected Latin American countries within the coming weeks, marking a significant step in making cryptocurrency a viable option for everyday transactions in emerging markets.
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