The international payment network Visa announced it would create a platform for the compatibility of various blockchains. It will allow to perform cross-border transactions and convert central-bank digital currencies and stablecoins.
According to a document published on the Visa website, using the platform, users will be able to seamlessly make cross-border payments and convert some national digital currencies to others, as well as stablecoins. The key goal of the project is to ensure the compatibility of various blockchains and to strengthen their interaction with each other. Visa's solution is a Universal Payment Channel (UPC) that processes transactions outside the blockchain. This solves the problem of scalability and time delays associated with on-chain transactions.
The UPC payment channel is described in the Visa document as a universal correspondent bank that requires the user to be identified only once, unlike bank transfers. Wallet providers will be setting up UPC hub channels to enable cross-border payments with multiple CBDCs. To do this, the wallet provider must provide identification and collateral. He can then start performing cross-chain transactions.
“Clients register with a UPC hub to route their transactions to other clients. Note that this routing requires zero trust to be placed on the UPC hub (the UPC hub does not need to be trusted like a central intermediary).”
The document says the UPC hub “acts as a gateway to receive payment requests from registered sending parties and routes them to registered recipient parties. The UPC hub is trusted to be highly available and process payment requests, and by design, its operation is fully transparent to any entity that can read the state of the two ledgers. Our protocol requires the UPC hub to authorize every payment that happens between the parties off the ledger.”
Earlier, the G20 emphasized that CBDCs are one of the possible ways to solve the problem of high costs of cross-border payments.