- Visa Tokenized Asset Platform (VTAP) helps financial institutions to tokenize fiat currencies on the blockchain.
- Visa has shaken hands with Spanish bank BBVA to test the VTAP sandbox functionalities.
- This product can bridge the gap between traditional finance and decentralized finance.
Visa is an innovative company in the blockchain and crypto sectors. The firm has partnered with multiple crypto platforms to launch cryptocurrency-linked debit and credit cards.
Visa has integrated blockchain technology to enhance cross-border payment solutions. Then, the firm utilized Circle’s USDC stablecoin to streamline transactions.
Recently, Visa launched its new product, Visa Tokenized Asset Platform (VTAP), to help banks issue fiat-backed tokens on the blockchain.
It is a substantial step in revolutionizing both the banking and blockchain sectors. In this blog, we will talk about crucial details regarding VTAP:
Understanding Visa Tokenized Asset Platform (VTAP)
On October 3, Visa launched VTAP to issue fiat-backed blockchain network tokens. Using their development platform, their banking partners can tokenize fiat currencies on the blockchain.
Also, Visa allows banks to issue fiat-backed tokens on a blockchain utilizing smart contracts. VTAP facilitates the integration of fiat-backed tokens on the blockchain through a managed sandbox environment.
Now, it is straightforward for financial institutions to mint and transfer fiat-backed tokens, such as tokenized deposits and stablecoins.
Clients can access the VTAP APIs, integration specifications, and testing tools to help them navigate the sandbox environment.
Visa can enhance the transaction experience for fiat experiences. It has a vast network of over 15,000 financial institutions spanning over 200 countries and territories.
Benefits Of VTAP
VTAP provides different advantages to its users by simplifying the management of fiat-backed tokens.
- Seamless Integration
The API integration of VTAP helps banks in minting and transferring fiat-backed tokens. This platform provides a unified set of APIs to streamline bank access.
Now, these financial institutions can easily explore possibilities before going live by testing solutions using the sandbox environment of VTAP.
- Bridging Blockchain Networks
Visa aims to facilitate interoperability across various permissioned and public blockchain networks.
Banks associated with the VTAP platform could engage in multiple use cases. They can also collaborate with partners and clients using various blockchain networks.
VTAP uses a permissioned EVM-compatible blockchain for initial use case testing. It ensures clients familiarize themselves with crucial functionalities, paving the way for future interoperability.
- Better Programmability
VTAP enables banks to incorporate fiat-backed tokens into smart contracts. It helps digitize and streamline current processes. Additionally, customers can use these tokens to buy tokenized commodities or treasuries.
Partnership With Spanish Bank BBVA
Spanish bank Banco Bilbao Vizcaya Argentaria (BBVA) is the first client of VTAP to test sandbox functionalities.
This bank is testing fiat-backed tokens in the VTAP sandbox. Also, a live pilot will be available on the public Ethereum blockchain in 2025.
Francisco Maroto is the head of Blockchain and Digital Assets at BBVA. He said their team is proud to continue spearheading the exploration of tokenized solutions with Visa through its VTAP platform.
Now, BBVA can broaden its banking services with VTAP. Also, they can extend the market with new financial solutions.
VTAP To Bridge Traditional Finance and Decentralized Finance
VTAP can easily bridge the gap between traditional finance and the decentralized world. This robust platform offers an innovative solution for modern digital transactions by leveraging tokenization and blockchain technology.
It helps banks to create tokens pegged to traditional currencies like the US dollar or euro. In this way, these tokens provide a familiar and stable value on the blockchain.
VTAP supports multiple blockchain networks, both permissioned and public. This interoperability guarantees that tokenized assets can be transferred seamlessly across various platforms.
Disclaimer
This article is intended for educational purposes only. It does not constitute financial advice. Cryptocurrency markets are unpredictable due to their risks. Please consult with a financial professional before making any investment 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.