The user’s data and currency are technically dependent on the banks or the government. If a user’s financial institution is hacked, the customer’s personal information is at risk. If the customer’s bank collapses or the customer lives in a country with an unstable government that is unable to regulate the stability of the economy, the currency can quickly depreciate.
Digital money, in that sense, is a good alternative. It exists independently of banks, tax authorities and the economic rate of any state. The global cryptocurrency system does not even have a central supervisory authority. All transactions and dealings are based on a blockchain algorithm and are securely recorded in an infinite network of computers. Finally, cryptocurrency transactions are also profitable because blockchain eliminates additional processing and transaction fees.
Visa understands all of these benefits. Visa is a global leader in electronic payments. In 2021, the company unveiled its new UPC – universal payment channel – to support central bank digital currency and Stablecoin transfers around the world.
This channel will act as a hub to connect multiple blockchains. It will connect different blockchain networks, creating dedicated payment channels between them, enabling the secure transfer of digital currencies and the processing of billions of transactions with reduced fees. According to Visa, this could mean connecting digital currency networks of states with other countries and cryptocurrencies.
This way, you will be able to send the required amount of money in U.S. dollars to London, for example, and automatically convert those funds into digital British pounds before they arrive in the recipient’s account. All this will be available in real time, to users of any country and cryptocurrency. Convenient, isn’t it?
Although bitcoin is the best-known application of blockchain technology, there are thousands of cryptocurrencies based on this new technology, designed to make business and government transactions more accurate, efficient, secure and accessible. As we prepare for the third decade of blockchain technology, it is no longer a question of whether older companies will be able to adopt the technology. The question is: When will they do it? We’ll wait and see.