Visa Publishes Whitepaper Proposing “Bridge” between Stablecoins and CBDCs

Visa has published a whitepaper detailing its plans for overcoming the challenges of lack of interoperability between various blockchains, in the form of a platform enabling “Universal Payment Channels” or UPCs.

The paper entitled Universal Payment Channels: An Interoperability Platform for Digital Currencies, highlights the limitations of certain blockchains when it comes to interoperability, scalability, and speed. It particularly focuses on the Etheruem blockchain and notes that, as of April 2021, the Ethereum network was capable of just 16.5 transactions per second – compared with 65,000 transactions per on VisaNet. Obviously, it fails to take other blockchains into account when making this comparison.

With the recent proliferation in the development of CBDCs, one of the main use cases of this proposed platform would be providing a bridge between various CBCDs, as well as between CBDCs and other “regulated stablecoins”.

The paper states: “With the combination of scalability and interoperability features that the UPC technology provides, UPC hub can be a bridge connecting regulated stablecoins with CBDCs in the future. We envision that the development of this technology will significantly expand the utility of digital currencies as means of making digital payment across a network of businesses, consumers, and developers – whether C2B, B2B, or P2P.”

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Read the paper in full here.