The latest Visa Patent will allow the central banks across the globe to mint digital fiat currencies as they aim to lay the groundwork for a future without the need of national fiat currencies. In today’s blockchain news, we take a closer look at the patent.
Visa processes up to 100 million transactions each day and the company has now filed an application for a patent to turn physical fiat currency into a newly digitized version. The filing which was filed with the US Patent and Trademark Office in November said that the system will be able to mint digital fiat currency and will keep info of all issuances on the blockchain. Managed by a central entity computer, the system will remove all physical cash from circulation.
According to the new Visa patent, the newly created digital fiat will be equivalent with physical cash. The denomination and serial number will be carried over the new system and a trusted certificate will be required to mint the digital cash in order to keep issuance a controlled process. Visa didn’t give much about what the central entity computer would be but the filing stated: “A central entity may be a central bank, which regulates a monetary supply.”
Part of the role is to act as a monetary overseer that was charged with managing volumes and ensuring that the value of the digital currency will remain linked to the physical fiat. The central computer will be the only one able to generate new digital cash. There’s no sense from the filing that some other entities will play a role in the ecosystem. Visa believes that the entity running a central computer will have the authority to take a physical fiat currency out of the system and destroy it.
It’s important to note that just because Visa filed the patent, it doesn’t mean that it intends to develop a digital fiat currency system. However, it shows the existing electronic payments firms that do well in the existing legacy system that explore innovations. Visa also awarded a patent for a detokenization system that was meant to redeem an asset that was locked in a token format.
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