VISA has officially filed a patent application for a digital currency possibly based on Ethereum.
After initially joining the Libra project and then abandoning it, it turns out that VISA is involved in the technological development of cryptocurrencies much more than was thought.
In fact, this patent application dates back to November 2018, more than six months before the announcement of the Libra project, but it was only published yesterday.
The summary of the technology for which the San Francisco-based Visa International Service Association is applying for a patent, states:
“Techniques are disclosed which include receiving, by a central entity computer, a request for digital currency. The request includes a serial number and a denomination of a physical currency. The central entity computer generates the digital currency for the denomination and linked to the serial number. The generating includes recording the digital currency on a blockchain. The central entity computer transmits a notification of the generation of the digital currency. The central entity computer causes removal of the physical currency from circulation in a fiat currency system”.
This technology seems in many ways similar to Libra, so it is hardly surprising that VISA initially joined the project launched by Facebook.
In fact, it would be a stablecoin probably based on Ethereum, with locked and verifiable collateral.
Another passage in the application reads:
“Every time a dollar worth of digital fiat currency is generated, the central entity ensures that a corresponding physical dollar bill is removed from circulation, in order to regulate the value of the digital fiat currency”.
The fact that this patent application dates back to November 2018 is not surprising, because it is also probably the same period when JP Morgan was working on its stablecoin.
In addition, the application not only mentions the Ethereum network, but also Bitcoin, Litecoin, Zcash, Dash, Ripple and Monero.
In some ways, it is curious that, unlike Libra, this idea is not based on its own centralized blockchain, but is imagined on public blockchains over which the company will never have any control. However, it does not necessarily envisage the use of decentralized blockchains, but it does not necessarily involve the development of a new blockchain either.
At this point, one would think that VISA might compete with Libra in the future, especially once Facebook and its members have resolved their legal issues and made their stablecoin properly regulated.