In this case, we're talking about automatic payments that are made from non-custodial wallets. That is, these are wallets whose users own the so-called Sid-phrase and are therefore full owners of the crypto-assets within them. Which means that Visa's initiative will eventually allow regular payments to be scheduled in coins, which will go to certain people's bank accounts after conversion.


In general, this is not the first time payment issuers have touched on the topic of cryptocurrencies. In early November 2022, for example, it became known that Mastercard had taken up funding for cryptocurrency start-ups. This means that the company sees serious potential in this area.

Mastercard

How Visa supports cryptocurrencies

The Eth network does not yet support such a feature, but it will be available for use once an offer called “Account Abstraction” is accepted. This upgrade will enable addresses on the Etherium network to operate on the principle of smart contracts with the ability to execute pre-scheduled functions in the code.

In and of itself, this news is not something revolutionary for the payments industry or cryptocurrencies in general. It is indicative of something else – Visa’s ambition to play a major role in the crypto-sphere. This is also supported by a quote from Decrypt’s head of digital currencies at Visa, Catherine Gu. Here’s the relevant line.

We want to be able to contribute to the development of new cryptocurrency projects. The best way to do that is to learn by doing. I think learning about Web3 infrastructure and blockchains is important for payments development.

Deferred payment scheme

Gu’s department originally focused on central bank digital currencies (CBDC), but is now expanding to study other technologies. They could potentially fundamentally change payments, but that won’t happen for a long time. The expert continues.

The technology is still raw, but there are many prospects for the future. We need to pay more attention to key aspects of payments like scalability and security.

As a reminder, scalability is a key issue when interacting with the Ethereum blockchain. Even after the blockchain switched to the Proof-of-Stake consensus algorithm, it can still handle about 13-15 transactions per second. Therefore, when the load on the network increases, transfer fees on the network could increase manifold, making the blockchain unsuitable for use by most.

Visa has already conducted some tests with a second-tier Ethereum solution called StarkNet and the Argent wallet. Unfortunately, there is no clear date yet for any new integrations on the mainstream Etherium network.

😈 YOU CAN FIND MORE INTERESTING STUFF ON OUR YANDEX.DEN!

While Visa is working on payments, Meta continues to work with the concept of meta-universes, as the company’s name suggests. However, since Facebook changed its name to Meta in October last year, the tech giant’s share price has already fallen by more than 60 per cent.

Accordingly, investors are rather sceptical about the idea of a complete shift of focus towards virtual spaces. However, this is also a bear market, as the vast majority of companies are now in serious decline in terms of share price over the past year. The reason for this is the economic crisis, high inflation and other consequences of mass money printing in 2020 on the back of the pandemic.

Meta’s share price drop over the year

Reality Labs chief technology officer Andrew Bosworth said 2022 was a tougher year for Meta than previously thought. Here’s his rejoinder.

The year 2022 began for Meta with a new name and a new vision for the future. Our job at Reality Labs is to make the vision a reality. We never counted on an easy path, but this year has been more difficult than anticipated. The economic crisis, combined with the pressure on Meta’s business, has created a perfect storm of scepticism about the investments we are making.

To recap, the Reality Labs unit was launched back then by Facebook in 2020. Its team had been developing the virtual reality helmet Oculus Rift VR in 2016, so it was chosen to bring the tech giant’s meta-universe project to life.

Meta’s meta-universe ad

In October, Meta reported that its Reality Labs division lost more than $3.6 billion in the third quarter of 2022. During the same period in 2021, the meta-universe initiative posted a loss of $2.63 billion. According to Bosworth, 20 per cent of Meta’s total investment went to Reality Labs, while the remaining 80 per cent went to Meta’s core business, Facebook, WhatsApp and Instagram.

Facebook founder Mark Zuckerberg

Despite losses and the layoff of some 11,000 employees, Meta CEO Mark Zuckerberg announced in November that the company would continue to move towards developing meta-universes. Unfortunately, the enthusiasm among many, including within Meta, has been slowly fading so far: the company’s developed version of the metaworld is considered a blatantly crude product even among its employees.


We believe that Visa's innovation in theory may not prove popular with users, as automated payments are not particularly popular for fiat money and cryptocurrencies. Be that as it may, this shows the payment giant's interest in the cryptocurrency industry and its willingness to invest to support the latter. And that's a good sign for further niche development.