Visa Steps Up Crypto Game With Tokenized Asset Platform

Global payments giant Visa has unveiled its new Visa Tokenized Asset Platform (VTAP), which will allow banks to issue fiat-backed tokens of real-world assets like bonds or commodities on Ethereum, according to reports from Blockworks [article since taken down] and Coindesk on Wednesday.

Spanish bank Banco Bilbao Vizcaya Argentaria (BBVA) is among the first financial institutions to use the platform. It targets to rollout a live pilot in 2025, the report said.

Tokenization offers several key advantages, including enhanced efficiency, increased accessibility, and the potential to drive innovation in financial products and services. By empowering banks to create and distribute fiat-backed tokens, VTAP aims to bridge the gap between traditional finance and the burgeoning world of blockchain.

VTAP aims to support a wide range of use cases, including real-time money transfers between bank clients, interbank transfers using wholesale central bank digital currencies (CBDCs), and cross-border transactions for multinational companies. These applications demonstrate the platform's potential to streamline financial operations, reduce transaction costs, and enhance global trade.

By providing a standardized framework for issuing and managing tokens, VTAP aims to promote interoperability and reduce fragmentation in the digital asset ecosystem.

Visa has already formed strategic partnerships with several financial institutions to test and refine VTAP. Visa previously announced a partnership with XP, one of Brazil's largest independent brokers, on a central bank digital currency (CBDC) initiative. The company has previously worked with HSBC and Hang Seng Bank on digital currency pilots in Hong Kong.