Visa Wants to Let Users Set Up Auto Payments From Self-Custody Wallets
According to a recent report, Visa published a proposal that would enable owners of Ethereum to set up automatic payments from their self-custody wallets. The process wouldn’t require banks, or any either centralized organizations to serve as intermediaries.
Visa Shares the Results of Its Hackathon.
Visa has long maintained an interest in cryptocurrencies building multiple partnerships over time with companies such as Circle in 2020, and Crypto.com. Earlier this year, the credit card behemoth hosted a hackathon that, among other topics and challenges, focused on the exploration of blockchain technology. A challenge of particular interest was one centered on helping a bankless vacation-goer pay her bills with Ethereum while away from home.
The proposed solution, published by the credit giant earlier today, would involve a process called account abstraction. This would entail turning a smart contract into a software wallet—an idea originally proposed by Vitalik Buterin as EIP-86 in 2017 but has since been left “stagnant”. Visa’s proposal involves using StarkNet, a layer two blockchain on Ethereum as account abstraction is live yet on ETH itself.
If Visa’s proposal sees use in real life, it could enable people storing their Ehterum in self-custody wallets to set up automatic payments without needing any centralized entities to serve as intermediaries. However, the authors of the paper themselves write that “the truth is there is still debate on how AA should be implemented on Ethereum.”
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The Flight From Centralization in Crypto
Visa’s proposal came out at an important time for digital assets. Recent scandals in the sector, primarily stemming from the collapse of FTX, caused a lot of people and institutions to lose faith in centralized exchanges. This, in turn, led to a renewed drive for decentralization in digital assets and self-custody for cryptocurrencies.
The intensity of the flight from centralized exchanges has recently been so high that Binance temporarily paused USDC withdrawals as outflows rose to $2 billion in 2 days on December 13th. On the other hand, decentralized exchanges and decentralized tokens have seen a surge in popularity with Uniswap DEX achieving a $1.10 billion trading volume in just 24 hours on November 15th.
Furthermore, the collapse of FTX boosted the claims that DeFi has become too centralized. One of the vocal critics holding this stance is Telegram’s Pavel Durov. In late November, Durov sent an announcement on his channel voicing this criticism of the state of digital assets, and announced his plans “to build a set of decentralized tools”. for the future of cryptocurrencies.
Do you think Visa’s proposition for automatic payments from self-custody wallets will see widespread implementation? Let us know in the comments below.