Global payments giant Visa (NYSE:V) has released a paper highlighting the potential of collaborating with the Ethereum blockchain to enable automatic payments directly from the users’ self-custodial wallets.
The novel proposal will utilise one of Ethereum’s leading developer proposals known as ‘Account Abstraction’ to explore how smart contracts can be implemented to enable automated programable payments.
While the proposal is far from being revolutionary to anyone who has a bank account, it would make crypto transactions more approachable to consumers and akin to real-world transactions, as visa is looking for new avenues for crypto innovation
Visa is exploring the many use cases of blockchain technology – the ones that exist today and those yet to come. Check out our first deep dive on what it would take to set up a scheduled auto payment on blockchain: https://t.co/KIbh3I4Iw1— VisaNews (@VisaNews) December 19, 2022
“Bring real value”
In the proposal, Visa’s head of central bank digital currencies and protocols Catherine Gu said: “To help our clients and partners innovate, we need to immerse ourselves in technologies that can bring real value to the payments ecosystem.
“We’re focused on growing our core competencies in Web3 infrastructure layers and blockchain protocols driving crypto development.”
At @Visa , we want to serve as a trusted bridge between the crypto ecosystem and our global network. Excited to share some update today, here is the ???? pic.twitter.com/OK1sWIaxY3— Catherine Gu (@catgu_) December 19, 2022
Account Abstraction
The proposal delves into a concept known as ‘Account Abstraction’, a developer proposal that is being explored for potential implementation in the Ethereum ecosystem.
The overarching premise of this concept is to make user accounts on Ethereum function more like smart contracts by allowing a user to have programable features embedded into their wallets.
In the paper, the Visa team demonstrates a potential application by mimicking the process you use today to set up a recurring card payment.
It said: “If, or when, concepts like AA are enabled on Ethereum, Visa’s proposal could help bring familiar payments experiences, like auto payments, to the blockchain ecosystem.”