WHY THIS MATTERS IN BRIEF
Central banks don’t want to loose control over their currencies so fiat backed tokens are one way to achieve that.
Love the Exponential Future? Join our XPotential Community, future proof yourself with courses from XPotential University, read about exponential tech and trends, connect, watch a keynote, or browse my blog.
As we see central banks mulling the idea of fiat backed tokenised assets, in part so they still remain relevant in the future where crypto currencies and other digital assets become more common place, the Visa Tokenised Asset Platform ( VTAP) lets participating financial institution partners mint, burn and transfer fiat-backed tokens, such as tokenised deposits and stablecoins, and experiment with use cases.
Currently available in a test environment, Visa says it plans to support live programmes next year when participating banks are ready to launch with end customers.
The product is designed to let banks use their tokens within smart contracts for programmability. For example, says Visa, a bank could automate the administering of complex lines of credit using smart contracts and use fiat-backed tokens to release payments when terms are met.
The Future of Banking and Payments, by Futurist Speaker Matthew Griffin
The payments giant also stresses its focus on interoperability across different blockchains for banks using the platform. With a single API connection to VTAP, in the future, banks can enable multiple use cases and interact with partners and clients on both permissioned and public blockchains.
Vanessa Colella, global head, innovation and digital partnerships, Visa, says: “We’re excited to leverage our experience with tokenization to help banks integrate blockchain technologies into their operations.”
Spanish lender BBVA has already been using the sandbox, testing the issuance, transfer and redemption of a bank token on a testnet blockchain, as well as interactions of the token with smart contracts. It is now targeting an initial live pilot with select customers in 2025 on the public Ethereum blockchain.
Francisco Maroto, head, blockchain and digital assets, BBVA, says: “This collaboration marks a significant milestone in our exploration of the potential of blockchain technology and will ultimately help enable us to broaden our banking services and expand the market with new financial solutions.”
The post Visa launches platform to help banks use fiat backed tokens appeared first on Matthew Griffin | Keynote Speaker & Master Futurist.