- Visa becomes one of the first major financial institutions to utilize Solana’s blockchain network for real-time settlements.
- The payment giant expands its pilot programs to include merchant acquirers Worldpay and Nuvei, allowing clients to opt for settlements in USDC stablecoin.
Visa is setting a precedent in the financial sector by fully embracing blockchain technology to optimize cross-border payments. As one of the pioneers, the San Francisco-based company has escalated its stablecoin settlement features by incorporating Circle’s USDC stablecoin onto the Solana blockchain.
1/🏦Breaking: Visa Expands Stablecoin Settlement Pilot to Solana@Visa is scaling their USDC settlement pilot to include the Solana blockchain, enabling enterprise-grade throughput at virtually no cost for Visa issuers and merchant acquirers on Solana. https://t.co/rF5ouZaISM
— Solana (@solana) September 5, 2023
Transcending Traditional Financial Paradigms with Blockchain
Solana, known for its high-speed transaction capabilities, has witnessed a nearly 2% uptick on this announcement. While the general cryptocurrency market remains volatile, the news signals a monumental shift in the adaptability of blockchain technologies like Solana in mainstream financial ecosystems. Visa asserts that it’s among the inaugural batch of significant financial bodies to deploy Solana’s network for settlements at scale.
In an ambitious move to extend its frontier, Visa has initiated pilot programs with global merchant acquirers Worldpay and Nuvei. These partners, which facilitate debit and credit card transactions globally, can now offer their clients an option to receive settlements in USDC stablecoin as opposed to traditional fiat currencies.
Visa’s foray into blockchain-based settlements dates back to 2021 when the company first experimented with USDC for its treasury functions. A pilot program with Crypto.com deployed Ethereum blockchain to handle cross-border payments made with Crypto.com’s Visa cards.
“By harnessing the capabilities of global blockchain networks like Solana and Ethereum, along with stablecoins like USDC, we aim to elevate the efficiency of cross-border settlements,”
said Cuy Sheffield, head of crypto at Visa.
As an expansion to its ongoing endeavors, Visa now has the capacity to send on-chain funds to acquirers like Worldpay and Nuvei. This mechanism significantly expedites settlement times for their participating merchants, many of whom are increasingly interacting with the blockchain and cryptocurrency realms. Using Visa’s Circle account, payouts can be managed in USDC, which are then routed by Worldpay and Nuvei to their respective end merchants.
Visa’s decision to incorporate Solana comes as part of an active push to meet burgeoning demand for faster, cheaper stablecoin transactions. Solana’s architecture allows for 400 millisecond block times and averages 400 transactions per second (TPS), scaling up to more than 2,000 TPS during peak activity. This capability renders it an ideal choice for Visa’s large-scale, real-time settlement needs.
No longer an experimental sideshow, stablecoins—cryptocurrencies tethered to stable assets like the U.S. dollar—are evolving into a cornerstone for remittances and financial vehicles, especially in emerging markets. Fintech heavyweight PayPal has also recently issued its own stablecoin, PYUSD, on the Ethereum blockchain, highlighting the sector’s accelerating embrace of this transformative technology.