Today Visa said it plans to offer central banks and financial institutions a central bank digital currency (CBDC) offering later this spring. The payment provider developed the Visa CBDC Payment Module and in conjunction with ConsenSys its CBDCgo proof of concept was one of the winners of Singapore’s MAS Global CBDC Challenge.
However, that solution was a proof of concept, and in the spring, it will start working on pilots and prototypes of specific use cases and consulting work will include its Crypto Advisory Practice which it launched in December. The company envisions the CBDC experience as similar to payments today with a CBDC-linked Visa card or tapping a digital wallet.
The Visa / ConsenSys solution is designed as a two-tier solution for CBDCs. It uses enterprise blockchain ConsenSys Quorum and the Visa CBDC Payment Module is being integrated with the ConsenSys Codefi CBDC sandbox. One of the challenges is that blockchain confirmations on Quorum take around ten seconds. Hence the team created a double spend prevention mechanism for the CBDC Challenge competition.
As part of the CBDC Challenge, Visa and ConsenSys consulted with 27 central banks. From this they found the top priorities are integration and interoperability with current payment systems, security, consumer trust as well as accessibility.
In September 2020, Mastercard launched its own platform to enable central banks and financial institutions to test CBDCs. Mastercard is also an investor in ConsenSys and worked with the Ethereum development house on ConsenSys Rollups for batching transactions to improve scalability.
Meanwhile, ConsenSys is working with numerous central banks on CBDC pilots, including Korea (indirectly), Thailand, Hong Kong, France, South Africa and Australia.
