Visa lures financial institutions with crypto advisory launch

Visa, the world’s largest payment processor, launched a global crypto advisory service for its banking clients and merchants on Wednesday, as the adoption of digital currencies gains steam.

The move is aimed at financial institutions eager to attract or retain customers with crypto offerings, retailers looking to delve into nonfungible tokens (NFTs) or central banks exploring digital currencies, the company said.

Visa’s services include educating institutions about cryptocurrencies, allowing clients to use the payment processor’s network for digital offerings, and helping manage back-end operations.

A new global study by Visa showed nearly 40% of crypto owners surveyed said they are likely or very likely to switch their primary bank to one that offers crypto-related products in the next 12 months.

Visa is set to launch services this year that will allow buying, selling and custody of digital currency through its banking partners.

There are also Visa card programmes that let users earn bitcoin on purchases and the network will also allow its client the use of USD Coin, a stablecoin cryptocurrency whose value is pegged directly to the US dollar, to settle transactions on its payment network.

However, for cryptocurrencies such as bitcoin to be used as a medium of exchange, price stability is needed, said Visa’s CFO, Vasant Prabhu.

“If the price is going to fluctuate from $60,000 to $50,000 in a few hours, it’s a very difficult thing for a merchant to accept [bitcoin] as a currency,” Prabhu said.

“I don’t know if cryptocurrencies like bitcoin will ever be a medium of exchange. Stablecoins will.” Visa will facilitate such transactions when the time is right, he said.

Reuters