Global credit giant Visa is exploring smart contracts and programmable payments. To that end, the firm wants to allow holders of the leading altcoin Ethereum to make automatic payments. Here are the details…
Visa has submitted a bid for the leading altcoin Ethereum
Visa has announced an offer that will allow Ethereum holders to make programmable payments from their own wallets. With this concept, banks and central third parties will be exempt from transactions. Users will pay directly from their custodian wallet. “Account Abstraction”, an Ethereum feature currently under review, will be used to process these transactions using Visa for automatic payments. This feature will allow customers to pay recurring invoices, which is not fundamentally allowed by Ethereum.
Setting up automatic payments on regular bank accounts is easy. However, the bank ultimately controls the system and the funds transferred. Visa enters the crypto realms offering its own custody service, starting with the industry standard Ethereum. Despite the massive drop in the crypto market, the firm seems to be excited about crypto.
What does “account abstraction” mean?
Visa emphasized that by using account abstraction, it was able to combine the features of user accounts and smart contracts into a single Ethereum account model. The resulting account is referred to by the company as the “representable account”. Catherine Gu, Visa’s head of central bank digital currencies and protocols, co-authored the proposal. “If one of the most important use cases of blockchain is for payments, then the basic requirement is that blockchain should work just as well as it does today,” she said.
As we’ve reported on cryptokoin.com, the offer uses a new concept known as Account Abstraction. Additionally, it is one of the leading Ethereum developer offerings that uses smart contracts to achieve automatic payments. Ethereum accounts consist of externally owned accounts (user accounts) or smart contract accounts. Visa wants to use account abstraction to consolidate them into a single Ethereum account type. Also, this will provide smart contract functionality to Ethereum user accounts.
There are advantages to taking into account the abstraction that Vitalik Buterin first formalized as EIP-86 in 2017. Enables multi-owner accounts through multi-signature verification and transferable accounts. It also allows a public account where anyone can trade.
Ethereum price rises
Meanwhile, the price of the largest altcoin, Ethereum, saw an increase following the Visa news. The altcoin managed to rise from the $1,160 level to $1,212 on a daily basis. It is currently changing hands at $1,208, up 3%.