Visa Files Patent for Blockchain-Based Currency, Spotlights Crypto, Ethereum and Digital Fiat

Payment giant Visa has filed a patent application for one system that can create and manage various digital currencies.

The patent, filed November 8, 2019, was published Thursday by the U.S. Patent and Trademark Office.

The Submit reveals the extent of the private sector’s interest in reviewing the current banking system. It highlights cryptocurrency, noting weaknesses and strengths.

Examples of a cryptocurrency network can be networks of computers that manage any suitable cryptocurrency, including but not limited to Bitcoin, Litecoin, Ethereum, Zcash, Dash, Ripple and Monero.

Cryptocurrency systems have advantages over fiat currency systems. For example, money transfers with cryptocurrency can also be faster than conventional money transfers in fiat currency. Finally, because some cryptocurrencies use blockchains, such cryptocurrencies are often trusted because blockchains are immutable transaction data.

While cryptocurrencies have advantages, they are generally not subject to regulations such as fiat currencies. Furthermore, it is not practical for governments to fully convert their fiat currency systems into cryptocurrencies, as cryptocurrencies require the use of electronic devices. Some of a country’s population may not have electronic devices, so a full conversion from fiat currencies to cryptocurrencies is impractical. ”

Visa’s remedy is to build a system that generates and manages centralized digital versions of multiple fiat currencies, including US dollars and British pounds.

According to the application, Ethereum could be used to implement certain aspects of the technology. However, unlike real cryptocurrencies, Visa’s patent describes a centralized entity.

The method includes a digital central currency registered on the blockchain, while the “central entity computer” removes the corresponding physical currency (fiat) from circulation.

The patent states:

A “central entity” can refer to an entity that regulates something. A central entity can be a central bank that controls a monetary provision. A central entity can conduct a monetary policy and issue currency. A central entity can retain exclusive rights to create or destroy currency in a region such as a nation. A central entity can be associated with a government of such a region. ‘

Earlier this year, Visa acquired the fintech company Plaid for $ 5.3 billion in an effort to provide more valuable services to financial institutions and consumers.

Plaid bridges customer bank accounts to financial apps such as Venmo and Betterment.

Featured image: Shutterstock / KanawatVector

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