The US company Visa has filed a patent application for its own digital currency based on blockchain technology. The application was already submitted to the US authorities in November 2018. The details were made public with the recent publication.
Visa intends to use blockchain and tokenized US dollars to improve the efficiency of its payment network. The complete submitted application is divided into two different approaches. Described as a ‘digital fiat currency’, one option would consist of a public key linked to a wallet. The other approach notes the “removal of the physical currency from the circulation of a fiat currency system”.
Patent also considers currencies other than USD
According to a report by Forbes, the patent should not only consider the US dollar, but could also be applied to other Fiat currencies, such as the euro, the yen or the British pound. The key process for creating digital currencies is described as follows:
Whenever a digital fiat currency is created with a value of, for example, one dollar, a central review body must ensure that the same value is removed from circulation in the form of physical money. This is absolutely necessary to regulate the value of the digital fiat currency.
Visa already announced in June last year that it would enter the $125 trillion market for cross-border business-to-business (B2B) transactions. The company plans to use bockchain technology to make payments faster, cheaper and more transparent.
Visa and other payment service providers recently turned their backs on Facebook’s Libra project
The US company Visa joined the Libra project of Facebook last year. After the regulatory and governmental pressure was increasing, the provider decided to leave the Libra Associationtowards the end of the year. Apart from Visa, other payment service providers such as Ebay, Stripe or MasterCard had also left. The payment companies fear that the handling of user data and data protection on Facebook in general will have a negative influence on the regulatory authorities. The statements of the respective companies do not exclude a cooperation with the Libra Association at a later date. They continue to examine “whether all necessary regulatory expectations can be fully met in the future”.