Payments Giant Visa Looks To Ethereum For Automatic Payments System
Payments giant Visa has teased a possible integration with the Ethereum network to enable an automatic payments system. Visa has already been working with blockchain for a while. However, this time around, it is gearing up for a self-custody wallet.
Visa Wants Automatic Transactions On Ethereum
Visa, which is one of the largest payment processors, is working on new ways for it to be able to enable transactions without involving a third party. The payments giant is moving towards an automatic payments system using the Ethereum blockchain to achieve this.
In its proposal, it plans to leverage the Ethereum account abstraction which was first presented by founder Vitalik Buterin back in 2017. This account abstraction will allow transactions to be verified and validated on the blockchain using programmable validity, according to Visa.
“This means that instead of hard coding validity conditions into the Ethereum protocol that will apply to all transactions in a generalized way, validity conditions can instead be programmed in a customizable way into a smart contract on a per-account basis,” the Visa proposal said.
ETH price recovers above $1,200 | Source: ETHUSD on TradingView.com
Basically, Visa plans to create a single Ethereum account that will combine aspects of user accounts and smart contracts to produce a single “delegable account.” It tries to take the operations that are used in bank accounts and integrate those into self-custodial wallets to allow for automatic payments.
In this way, a merchant, for example, will be able to set up a smart contract that will allow customers to pay automatically from their self-custody wallets. This means bringing automatic bill payments currently only available via traditional finance infrastructure to a decentralized blockchain system. However, this is still only in the concept stage and is yet to be implemented, although the most recent EIP-4337 discusses this as a possibility.
To achieve this, Visa says it is working with external Ethereum developers. The work being done stretches beyond producing the aforementioned self-custody wallets but also involves increasing the transaction capacity and speed of the network.
This comes just two months after it was made public that Visa had filed trademark applications to produce a crypto wallet. From a payments standpoint, the company believes that most blockchains need higher scalability to be adopted by large players such as Visa.
Featured image from PCMag, chart from TradingView.com