Visa is collaborating with the blockchain software company ConsenSys to launch a central bank digital currency (CBDC) pilot program to test retail applications like cards and wallets, Bloomberg reported on Thursday (Jan. 13).
Both companies will first hold talks with an estimated 30 central banks regarding what the monetary authorities expect to achieve with government-backed digital currencies. The pilot is anticipated to launch in the spring of this year.
The move comes as regulators worldwide continue to grapple with how best to approach CBDCs in an evolving financial landscape overgrown with cryptocurrencies. A dominating concern is the fear that crypto and digital money will upend financial markets or take over fiat.
The move also follows Mastercard’s launch in 2020 of a CBDC test platform that enabled banks to simulate the issuance, distribution and exchange of CBDCs between banks, financial service providers, and consumers, PYMNTS reported at the time.
See also: Mastercard Leads New Central Bank Digital Currency Test Platform
Visa started offering payment cards linked to the stablecoin USD Coin in March. The USD Coin is pegged to the U.S. dollar and is managed by a consortium called Centre, which was founded by Circle and includes members from the cryptocurrency exchange Coinbase, PYMNTS reported.
Read more: Visa Network Will Settle Transactions In Crypto, First Use Case USD Stablecoin
“We think that stablecoins and CBDCs will coexist in the future and there’ll be a number of different approaches to creating products based on that,” Cuy Sheffield, Visa’s head of crypto, told Bloomberg.
China has already launched several trial programs with the digital yuan and is planning to accept the currency at the Beijing Winter Olympics. Nigeria and the Bahamas are also circulating their own CBDCs.
ConsenSys is headed by Ethereum co-founder Joseph Lubin, who has already tested CBDCs with the Hong Kong Monetary Authority, the Reserve Bank of Australia, and the Bank of Thailand.
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