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October 3, 2022
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Bitcoin

– Bitcoin, cryptocurrencies and blockchain technology.

VISA has recently been particularly active in the cryptocurrency space. The company has launched new initiatives to help adopt digital currencies. The company’s latest proposal could have huge benefits for cryptocurrencies, particularly for assets issued by governments.

CBDC without internet access

VISA published a document examining the possibilities of using central bank digital currencies (CBDC) in completely off-line environments. Entitled “Towards a Two-Tier Hierarchical Infrastructure: Offline Payment System for Central Bank Digital Currencies”, the document presents an offline payment system proposal that will allow governments to use CBDC even more smoothly.

In this document, VISA acknowledged that CBDCs are becoming more and more common in the modern financial ecosystem as more and more countries consider the possibility of transferring their sovereign currencies to the digital space. However, while the company applauded this trend, it also highlighted the need to be able to process transactions off-line.

To achieve this, VISA has proposed a system that combines public key infrastructure with open source technology. The credit card issuer explained that both elements will enable users to send transaction messages without being connected to the internet.

Recipients can send signed offline payment messages to an authorized wallet provider with guaranteed settlement of these transactions to withdraw funds from the offline payment system.

The payment processor added that the offline CBDC system will create an experience similar to traditional cash. However, instead of having paper in their pocket, users will continue to enjoy the benefits of digital, faster payment processing. This system could be the key to achieving the main goals of the CBDC – banking the society and creating a more dynamic economy.

All of this is still under investigation, as VISA admitted. So far no code has been written for such a system, and work has not yet started.

VISA is not the first

This innovative idea of ​​Visa is not entirely innovative. Various countries have been working on CBDC for months, and several of them have focused precisely on providing services without an internet connection.

In October, the mobile phone manufacturer Huawei announced that its new flagship device, the Mate40 series, will feature a hardware wallet for the upcoming digital Chinese yuan. As explained in the announcement, the asset will be an important part of China’s digital evolution and their wallet will provide holders with optimal anonymity.

The wallet will also feature a double transaction feature, which will allow users to make transfers just by touching two compatible phones. This feature will also work without an internet connection.

Japan is also moving in a similar direction. Bank of Japan announced in October, work on digital yen tests. The bank explained. that focuses on delivering an asset that will function as a payment tool.

The report explains that the Bank is working on enhancing CBDC’s ability to survive network failure. In a country prone to natural disasters that could result in a lack of Internet access for a few days, the Bank hopes to create a digital john that will work even in the event of “Force Majeure”.

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