Visa proposed new method for offline digital crypto payments after it released a paper looking at the benefits of central bank digital currencies and how they can be used offline so let’s find out more in today’s cryptocurrency news today.
Central Banks across the world are researching new digital versions of their own currencies which are the central bank digital currencies. Visa proposed new method according to a research paper exploring how these currencies will be used to make transactions offline. Most countries across the world are in the research stage of developing a CBDC. Visa proposed an offline payment system for central bank digital currencies as per the research paper and it’s dubbed “Towards a Two-Tier Hierarchical Infrastrcutrue: an Offline Payment System for Central Bank Digital Currencies” where you can learn about the benefits of CBDCs but they should once they become available and could be made without an internet connection.
CBDCs are a digitalized form of fiat currencies that run on a blockchain but don’t need to have to use the distributed ledger technology.
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Unlike crypto assets like Litecoin and Bitcoin, a CBDC will be controlled by a single entity. In order for the payments to be made offline so Visa proposed a system that will use “open source technology and public key infrastructure” so the transaction messages could be signed without the need to be connected to the internet. The proposal outlines a new protocol that could be developed in the future without codes for the idea being written yet. As per the paper:
“Recipients can submit signed, offline payment messages to an authorized wallet provider with guaranteed settlement of those transactions in order to withdraw funds from the offline payment system.”
According to Visa, one of the main reasons the central banks are looking into digital currencies is because they would help connect the unbanked people to a new ecosystem that will be accessible Fintechs and other final products. The goal Is that an offline payment system will create an experience similar to physical cash but as Visa put it:
“But instead of paper in your wallet, it’s bits and bytes in your phone.”
However, the research is only research as most countries interested in the technology are still in the early stages of developing a CBDC while some are afraid to even enter this world of crypto.
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