Visa’s New Crypto Consulting Service For Merchants and Banks
The world’s biggest card firm has recently increased its bet on capturing a piece of the cryptocurrency business. As part of its Visa Consulting & Analytics (VCA) division, Visa said today that it has created a crypto consultancy practice for its customers and partners.
Earlier this month, Cuy Sheffield, Visa’s head of cryptocurrency, said that the asset class have already become “cool” during a fintech conference in New York City, only a few months after the announcement. Its purchase of a CryptoPunk Non-Fungible Token in August generated headlines, but its decision to start a specialized crypto consultancy demonstrates that its efforts to acquire market share in an overcrowded crypto space go beyond marketing stunts and into the realm of business strategy.
In an interview with TechCrunch, Sheffield revealed that Visa’s connections with cryptocurrency platforms had more than quadrupled in the last 18 months. According to Sheffield, consumers have also spent over $3.5 billion using Visa’s crypto-linked card schemes, an increase from $1 million in July.
A recent worldwide poll carried out on consumer attitudes toward cryptocurrency revealed that 40% of the more than 6,000 respondents would be willing to transfer main banks to one that provides cryptocurrency-related goods and services.
According to Sheffield, Visa has had “an extraordinary volume of inbound inquiries from hundreds of customers and partners, as well as conventional financial institutions” who are interested in incorporating cryptocurrency into their business. It is estimated that Visa Consulting employs around 700 people, however, the business did not specify how many will be involved in the cryptocurrency practice.
In Sheffield’s opinion, Visa is well-positioned as a worldwide neutral brand with a significant understanding of cryptocurrency that can assist in abstracting away a few of the complexities of these latest techniques and assisting banks in incorporating them into their core businesses, according to the CEO.
Visa is only one of several card issuers seeking to get a foothold in the cryptocurrency space, which is challenging their fee-based business model by eliminating them as the emerging underlying architecture for payments, according to the Financial Times.
The cryptocurrency rewards program was established by Mastercard in October of this year, with Bakkt serving as the company’s digital asset custodian of the record. Visa, like many other financial institutions, does not keep cryptocurrency in its possession, instead of partnering alongside Anchorage Digital to offer this service — a firm in which it initially invested in 2019. Sheffield said that Visa is developing its cryptocurrency API platform on edge of Anchorage, which will allow other institutions to utilize their custodial services.
Per the Atlantic Council, 87 additional nations are contemplating establishing CBDCs, although just 7 countries have done so yet.
Sheffield said that Visa is trying to capitalize on this enthusiasm by assisting banks in the development of CBDC-related products.
It has taken a substantial amount of time and effort to investigate what design CBDCs would use for customer experiences as well as how customers would interact with CBDCs, and we have made great progress. It is being brought to use in supporting banks as companies begin thinking about their roles in preparing for the potential of numerous countries pursuing this road. We have acquired valuable knowledge via our contacts with central banks, Sheffield said.