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Visa Files for Digital Dollar Blockchain Patent to Replace Cash

May 18, 2020 / Nilesh Kumbharkar
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  • Visa has filed an application for a U.S. patent on a computer system that would convert physical dollars into digital versions.

  • The system would then remove the paper currency from circulation.

  • The patent application indicates that Visa would deploy the system in partnership with government central banks.


Credit card giant Visa has filed an application for a U.S. patent on a computer system that would convert physical dollars and other fiat currencies into digital versions, complete with denominations and serial numbers and recorded via blockchain. The system would then remove the paper currency from circulation.


According to the [details] discussed herein, the payment ecosystem may become entirely (e.g. 100 percent) digital, according to various embodiments, cash may be removed from the markets in a frictionless manner and the payment ecosystem may be improved.

- Visa in its application.


Visa did not immediately respond to a request for comment on the filing. But the company wrote in the document that under the system, users could “hold digital currency with the same denomination as the local physical currency (e.g., $100 for User A in America, 200 pesos for User B in Mexico and so forth) in order to perform transactions in a secure, fast and reliable way.


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The company said that the system “may record bank note serial numbers and denominations to prevent duplicate bank notes, [and] may ensure transaction security by storing transaction signing private keys on a chip or mobile device Secure Element (when available). Embodiments may also allow for user anonymity.”

Visa further said the technology would allow transactions using digital fiat currency “to be processed and completed immediately without requiring settlement and clearing processing.”

The patent application indicates that Visa would deploy the system in partnership with government central banks, which it referred to as “central entities” in the filing. After all, only central banks have the power to withdraw currency from circulation in the manner Visa describes.
 

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A central entity may be a central bank which regulates a monetary supply, A central entity may implement a monetary policy and issue currency. A central entity may maintain exclusive rights to create or destroy currency in a region such as a nation. A central entity may be associated with a government of such a region.

- Visa


About Visa

Visa Inc. (NYSE: V) is the world’s leader in digital payments. Our mission is to connect the world through the most innovative, reliable and secure payment network - enabling individuals, businesses and economies to thrive. Our advanced global processing network, VisaNet, provides secure and reliable payments around the world, and is capable of handling more than 65,000 transaction messages a second. The company’s relentless focus on innovation is a catalyst for the rapid growth of connected commerce on any device, and a driving force behind the dream of a cashless future for everyone, everywhere. As the world moves from analog to digital, Visa is applying our brand, products, people, network and scale to reshape the future of commerce.