Visa has released a product that allows financial institutions to issue fiat-backed tokens on blockchain networks.
The Visa Tokenized Asset Platform (VTAP), which the company announced on Thursday (October 3), will now be available on Visa’s development platform, allowing bank partners to “create their own fiat-backed tokens in the VTAP sandbox. Now you can do experiments.
The initiative will leverage the company’s expertise in technologies such as smart contracts to enable banks to issue and transfer fiat-backed tokens on blockchain networks, Visa said in a news release provided to PYMNTS. He said he would make it possible.
“Visa has been at the forefront of digital payments for nearly 60 years, and with the introduction of VTAP, we are once again setting the pace for the industry,” said Vanessa, Global Head of Innovation and Digital Partnerships at Visa. Corella said in a release. .
“We are excited to leverage our experience in tokenization to help banks integrate blockchain technology into their operations.”
According to the release, Spanish bank BBVA has already been testing VTAP sandbox functionality this year, including the issuance, transfer and redemption of bank tokens on the testnet blockchain, as well as the interaction of tokens with smart contracts.
The bank aims to launch its first live pilot with select customers on the public Ethereum blockchain next year, Visa added. VTAP benefits include ease of integration, programmability, and interoperability (release notes).
“There is a growing ecosystem where tokenized real-world assets are issued across multiple permissioned public blockchain networks,” the company said. “Visa’s vision is to leverage the VTAP platform to enable interoperability between banks’ various blockchains.”
API connectivity to VTAP will allow banks to enable multiple use cases and interact with partners and clients on public permissioned blockchains in the future.
“To support the widespread ecosystem adoption of tokenized assets, Visa is supporting the safe and secure cross-chain exchange of tokenized real-world assets using fiat-backed tokens. We are committed to making this possible,” the release added.
PYMNTS explored the role blockchain technology will play in cross-border payments in a recent conversation with Sheraz Sher, general manager of payments and commerce at Solana Foundation.
“Blockchain solutions and stablecoins, I don’t want to use the word crypto. This is more about fintech and they are proving to be a good fit for the product market in cross-border payments. Because of this,” Scheer said.
He added that one of the most notable benefits of blockchain technology is the removal of intermediaries, eliminating the need for multiple hops through correspondent banks, which typically make transactions slower and more costly. .
