Visa is Moving Ahead-Will Soon Begin Using Cryptocurrency
Vivian Haas
Staff Writer
Throughout the evolution of the technological age, the emergence of cryptocurrencies has surfaced in the market. Cryptocurrencies, also known as crypto assets, are a type of currency that have no physical state, only a digital currency rate. Crypto assets, such as Bitcoin, Litecoin, and Ripple, appeal to consumers due to them being unregulated and used to trade for profit. However, there is a concern due to the value of cryptocurrencies being influenced by public speculation. There are, in reality, no assets to back up the value of crypto assets. This unfortunately results in highly volatile rates. This was seen in 2018, when the price of Bitcoin decreased by 65 percent from January 6th to February 6th which resulted in an extraordinary loss from many investors.
Visa has partnered itself with Anchorage, a digital asset bank, in order to complete their goal. The way USD Coin will work with Visa is through a cryptocurrency wallet, that will be converted into traditional money once a purchase is made. This deposit, along with added transfer and complexity costs, will be wired to Visa at the end of the day to settle any transactions. When the cryptocurrency is used, Crypto.com will send USD Coin to Visa’s Ethereum address at Anchorage. In conjunction with their partnership with Anchorage, Visa has completed their first transaction in March and is planning on assimilating digital currencies in the future.
Even though financial industries have started accepting digital currencies, the unregulated aspect of this currency concerns the government, which has led them to attempt to moderate it. In December 2020, the U.S government proposed new rules and regulations for crypto wallets and cryptocurrency transactions. These regulations would require that monetary businesses collect identity data as well as financial transaction data during operations. This ensures that these businesses will be able to provide the information to the government under some circumstances. As of now, the proposal has not been accepted and put into practice, but regulations could start popping up in the United States at any time if the popularity of digital currency continues to expand.
Contact Vivian at vivian.haas@student.shu.edu