Payment giant Visa on Monday published a paper that outlines how it could possibly in future collaborate with the Ethereum network on automatic payments.
Visa has proposed a solution known as “account abstraction” that utilizes smart contracts to enable automated programmable payments on the Ethereum network. Visa’s proposal would involve creating a smart contract that will act as an intermediary between user accounts and a contract account and would allow for the creation of a self-custodial wallet enabled to make automatic and recurring payments without the need for a user actively participating in the process per reports by CoinDesk. Visa added that such a solution would allow recurring payments to be processed entirely over blockchain networks and have suggested deploying the functionality on the Ethereum layer 2 network StarkNet. Such capabilities are not yet possible on the Ethereum mainnet.
Auto-Payments Signal Visa’s Commitment to the Crypto Space
Cryptocurrency auto-payments will not necessarily have the greatest impact on banking and payments but do signal payment giants such as Visa’s commitment to becoming active participants in the crypto space. Visa’s Head of CBDC and Protocols spoke to Decrypt and said:
We want to have an opportunity to actively contribute to technical developments happening in the crypto ecosystem. The best way to do that is learning by doing—actually getting deeper into Web3 infrastructures and blockchain protocols, areas I think are going to be really important for payments.
Visa is not entirely new to the crypto space. Blockchain.com recently announced the launch of a pre-paid crypto-centric Visa card in which each Blockchain.com Visa card is linked to a verifiable Blockchain.com Wallet account. Customers using these cards will be able to use their crypto or fiat balance to pay online for physical goods and services at U.S. merchants that accept Visa cards.
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