- By 2025, BBVA plans to initiate an Ethereum Blockchain Pilot with the help of VTAP.
- Visa introduced VTAP to help banks issue tokens backed by fiat currency.
Visa, a payment company, recently introduced its product, the VISA Tokenized Asset Platform (VTAP). It is a platform to aid the bank in launching the tokens on the Ethereum network backed by real money. The primary goal behind this project is to revolutionize global asset tokenization.
This platform, VTAP, would help enable fiat-backed tokens. These tokens function with the help of smart contracts. This facility would help digitize and automate the ongoing procedure. It will also facilitate the exchange of real-world assets (RAWs).
With the help of this product, a bank can easily purchase the RWA tokens and make settlements in real-time with funds.
BBVA Leverages VTAP to Launch Its Ethereum Blockchain Pilot Project
Surprisingly, the Spanish bank Banco Bilbao Vizcaya Argentaria (BBVA) has started utilizing VTAP this year. In Spain, that bank used the technology in a trial based on creating, transferring, and redeeming themes.
Abdullah Nassif is a renowned crypto analyst. He shared on X that BBVA could launch its first pilot project on the Ethereum blockchain by the end of 2025. It would be prohibited for multiple users, and only a handful could operate it.
JUST IN: Visa To Help Banks Test Smart Contracts & Tokenized Assets!!
— Good Morning Crypto (@AbsGMCrypto) September 25, 2024
“We think that creates a significant opportunity for banks to issue their own fiat-backed tokens on blockchains, do it in a regulated way and enable their customers to access and participate in these… pic.twitter.com/RWx5vV7cEF
Furthermore, BBVA’s ongoing partnership with Visa may represent how decentralized technology is upending established banking systems. BBVA securitizes assets, including bank money, to give its clients efficient tools for managing their financial operations.
The financial institution recognized the significance of establishing global guidelines for the integration of blockchain technology within the financial services industry. It also makes it possible for future adherence to the sector’s guiding principles and strategic coherence.
Fintech companies such as PayPal have been at the forefront of stablecoin innovation. Visa’s current initiative suggests that big banks are ready to test out blockchain technology. Paypal recently used Solana to support the stability of the PYUSD.
Visa’s VTAP Sees To Establish International Guidelines For Blockchain Integration
Following the BBVA plot project, Visa wants to create international best practices for communication across financial institutions.
Visa has played a role in Central Bank digital currency (CBDC) trial initiatives. It includes the initiatives the Hong Kong Monetary Authority and the Central Bank of Brazil run.
In collaboration with XP, a significant independent broker in Brazil, Visa is also taking part in the Drex pilot program.
VTAP increases liquidity and investment opportunities by facilitating direct access to on-chain capital markets. Furthermore, Visa has participated in significant initiatives like the Hong Kong Monetary Authority’s Digital Hong Kong Dollar program.
Visa is not a new player in this league. In the past, Visa has worked with digital currencies. In a pilot program that Visa conducted last year, HSBC and Hang Seng Bank participated as partners and tested live interbank B2B payments.
Visa aims to equip banks with security and privacy tools while benefitting from blockchain technology. For this achievement, it has chosen the Ethereum blockchain, which offers scalability and security and is the best choice.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
Dr. Naveen Singh is an entrepreneur with achievements in sports, academics, healthcare, innovation, blockchain technology, telecommunications, and philanthropy. He is the Co-Founder and Chief Executive Officer (CEO) of Inery, the first layer-1 blockchain programmed for database management. With Inery, he aligns with his vision of a new paradigm for data to empower web3 and complete decentralization.