Can Visa and Mastercard Help CBDCs?

What do I mean by that? Well, it’s safe to say that around 80% of central banks around the world are either considering CBDC, developing it, or already testing the created product.

Problems with CBDCs From Outset

One thing that emerged as a serious issue along the way is their interoperability. As pretty much everyone is aware, crypto and interoperability do not exactly go hand in hand. This is especially noticeable with traditional cryptocurrencies, which are only now, after 12 years of existence, beginning to find methods to become interoperable.

Now, I believe that central banks and their CBDCs will have a bit easier job at becoming interoperable than traditional crypto, but this is still a significant issue. As you probably know, CBDCs will have to share a number of things in order to work with one another, including compatible tech, standards, code language, and alike. Otherwise, they simply won’t be functional.

Solutions for CBDCs

So, what is the solution? Possibly, companies like Visa and Mastercard. These are prominent payment players that have already moved to crypto some time ago when it became certain that digital currencies aren’t going away. Previously, Visa cracked the infrastructure and interoperability requirements to process traditional payments between businesses, merchants, and even governments.

It created its own VisaNet solution which brought interoperability between the layers of government in 200 countries, not to mention 46 million merchants and businesses, 3 billion cardholders, and over 15,000 financial institutions.

MasterCard is not too far behind, either, so it is safe to say that these companies have pretty much the most experience on how to make CBDCs interoperable via their service. In fact, they are already innovating around CBDCs, with Mastercard launching its virtual testing environment for CBDC evaluation. Visa launched a solution for USDC settlements by using Ethereum’s blockchain. It teamed up with numerous crypto firms to create their own crypto cards, and more.

Being so deeply involved, these payment providers can certainly help in making CBDCs interoperable as well and might be the key for bringing the era of digital currencies, even if central bank-owned, to reality.

Do you think that Visa and Mastercard will solve CBDC interoperability issues?

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