Visa goes for USDC with Circle

Visa, the credit card giant, has joined with Circle to connect 60 million merchants to the US Dollar Coin (USDC), a coin on the Ethereum blockchain. This is yet another sign that cryptocurrencies are integrating even further with mainstream payment currencies.

Although Visa won’t have custody itself of the USDC, it is going to work with Circle to select Visa credit card issuers and integrate the USDC software with their platforms, so that it can be used for payments. What this means is that businesses will soon enough be able to make international payments in USDC to other businesses supported by Visa. The funds will then be converted into national currencies when they are spent anywhere that accepts Visa.

Circle is a part of Visa’s Fast Track program, and when it completes the course next year, that is when this new USDC program will begin, with the issuance of a new credit card that allows users to spend USDC. Visa’s head of crypto, Cuy Sheffield, said, “This will be the first corporate card that will allow businesses to be able to spend a balance of USDC. And so we think that this will significantly increase the utility that USDC can have for Circle’s business clients.” 

The partnership between Visa and Circle, helped by the $40 million investment Visa made in another firm developing a platform for holding similar assets issued on a blockchain, “is the latest evidence that the credit card giant sees the technology first popularized by bitcoin as a crucial part of the future of money,” Michael de Castillo writes at Forbes.

Sheffield said, “Blockchain networks and stablecoins, like USDC, are just additional networks. So we think that there’s a significant value that Visa can provide to our clients, enabling them to access them and enabling them to spend at our merchants.”

Currently, according to Visa’s data, “$120 trillion in payments annually are made using checks and instant wire transfers, costing as much as $50 each.” By contrast, since USDC settles on the ethereum blockchain, transactions can close in a little a[s] 20 seconds and, importantly, can be done for nearly free.

Visa has been making strong moves in the cryptocurrency sphere this year. In February 2020. Coinbase became the first company granted principal membership status by Visa. This means that Coinbase, one of the biggest crypto exchanges globally, can in turn issue cards to others.

Circle has done some rethinks of its own in regard to cryptocurrency. In 2019 it had a fire sale of its assets including Poloniex, Circle Invest and Circle Pay. It also rebranded its home page with a focus exclusively on stablecoins and central bank digital currencies. The attraction of the USDC is that it is built on the Ethereum block chain and only tiny amounts of the cryptocurrency ETH are used as “gas” to pay for the transactions.

Jeremy Allaire, the CEO of Circle Internet Finance, says of the new partnership and its probable outcome: “Imagine a capital marketplace that is for anyone who needs capital, or anyone who needs to offer capital that has the same efficiency that Amazon has for e-commerce, the same efficiency that YouTube has for content, effectively, capital markets with the efficiency of the internet, which is essentially zero.” He added, “And that will ultimately return trillions of dollars in value back to the economy, it will reduce costs for every business in the world, it will accelerate the way in which individuals can participate in commercial activity and commerce activity, in conducting their labor and interacting with businesses around the world.”

The rise of the neobanks Part 1

Should we focus more on bitcoin’s use case than its price?

The crypto rollercoaster has morphed into ride with only slight dips and rises this month. It seems s if every few days traders need to take a rest and the bitcoin price sags a bit, The majority of the leading altcoins appear to follow what happens with bitcoin, although not uniformly.

As we head into next week, it’s hard to predict what we might see, although the weekends tend to bring some dips, suggesting that on Friday traders think about exiting the market for a couple of days. Jim Preissler writing at Forbessuggests: “Heading into the new week, expect possible dips to still be well supported at $4,700 in BTC and $154 in ETH. $5,800 and $187 could be tough resistance.’

As Preissler points out, XRP does not seem to have benefited from the latest crypto rally as much as BTC. ETH and LTC and there appears to be resistance at the $0.38 mark. ETH has been consistently outperforming XRP since February and it doesn’t look like there is going to be much change there.

Omkar Godbole at Coindesk suggests that what is needed to move the market along is a breach of BTC’s new resistance level of $5.200. As I write on 17th April, we have a slight glimpse of that as BTC touched $5,200.14. The market-leading cryptocurrency picked up a strong bid at lows below $4,200 on April 2 and jumped to 4.5-month highs above $5,300 on April 8, confirming a bullish reversal. However, over the last couple of days that rally paused, which Godbole attributed to BTC being overbought amongst other factors. But momentum seems to moving in an upward direction again. And, as Godbole has pointed out, “the longer duration outlook will remain bullish as long as prices are trading above $4,236.”

For the moment, bitcoin is trading above that level, but are we too focused on price?

As more real life use cases for bitcoin appear, such as the news that UK’s largest travel agency Corporate Traveller is now accepting bitcoin for payments, and the town of Innisfil in Ontario accepts BTC to pay property taxes, it is to be hoped that the public sees more advantages to using bitcoin for a range of payment purposes. That should encourage more belief in the cryptocurrency, and boost the number of people owning e-wallets and joining exchanges to purchase crypto. Slowly, slowly, cryptocurrency is edging forward toward mass adoption. We are a long way from that yet, but there’s no need to panic. It takes time to adjust to the new, even when the use case and the benefits are clear to a few. Just think back to the beginning of the Internet and the length of time it took the average consumer to feel comfortable with it. When people understand the benefits of using bitcoin and focus less on the price it is trading at, I believe that is when we’ll see a sea change in the crypto market.

What blockchain is and what it isn’t

The ‘blockchain’ word has been in popular use since 2017 and it has come to mean anything from the technology that will change to world to a digital form of snake oil. It was also going to make every investor in it very rich.

Part of the blockchain legend has been based on all the hype around cryptocurrencies, and it is fair to say that its powers have been inflated to the point where some people have come to believe it is capable of delivering things that it most likely can’t. After all, it is just a database with new features.

Jack Dossman writes at Hackernoon defines it thus: “It allows multiple parties to record and share information on a database in real time, and not need to trust each other, as they are incentivised to do the right thing through tokens/coins.”

As he says, blockchain has a certain specificity that only makes it useful in certain circumstances. It’s great for cryptocurrencies and for faster, cheaper cross-border payments services, but it isn’t a solution for absolutely everything.

It has some flaws: for example, the proof-of-work mechanism uses extraordinary amounts of electricity. But, we must also remember that we are still in the early days of blockchain and to dismiss it now would be the equivalent of saying in 1995 that the Internet would never work.

It isn’t a ponzi scheme and it isn’t a way of making a company’s share price rocket simply by adding ‘blockcian’ to a company name; especially when there is no blockchain involved. Neither is it a tool exclusively used by scammers as some would like you to think. That’s just a side effect of the technology, not its ultimate purpose. Plenty of scammers use email and social media channels, but that doesn’t stop us from using the Internet.

It won’t revolutionise you business, unless your company really needs blockchain technology to grow — so don’t add it in just for the sake of it. Plus, you’ve probably heard that it’s a ‘disruptor’; well, it probably won’t disrupt every industry sector, because it isn’t needed everywhere.

So what is blockchain?

It is technology that provides:

· A shared, add-only database

· Removes need for intermediaries

· It’s trustless

· It offers consensus and validation

This makes it perfect for cryptocurrencies and the finance world. There may be other mass-market cases for blockchain use that will come to light in the future, but just don’t believe absolutely everything you hear about what blockchain can do.