Payment giant Visa has filed a patent application for a digital currency secured by fiat and created on "centralized computers", which can form the basis of a potential new technology used by central banks. It is reported by Forbes.
The company believes that this approach will provide a balance of risks and benefits when creating a digital currency of the country's central bank (CBDC), allowing regulators to maintain control over the value and volume of the currency.
“Cryptocurrencies have advantages over fiat currencies, in particular due to the speed of transactions, greater trust due to the immutability of the blockchain. At the same time, they are not subject to regulation and rely on the use of electronic devices that are not accessible to all segments of the population. For this reason, the full "digitalization" of the currency is impractical, "the explanation is given in the application.
The concept of “digital fiat currency” involves its management by a centralized authority to “maintain control of the monetary system”, the function of which can be performed by a central bank or a state agency.
The application explains that the state organization will be entrusted with the role of implementing a monetary policy, as well as issuing and destroying currency.
The application mentions Ethereum 11 times. The authors admit that certain parts of the proposed system can be based on the blockchain of the second cryptocurrency. A potential candidate for this role is also Hyperledger Fabric.
At the same time, in a discussion with Forbes, a Visa representative admitted that this patent would not necessarily translate into a full-fledged product. The company's development team regularly experiments with advanced technologies, and the payment company registers hundreds of patents.
Former chairman of the US Commodity Futures Trading Commission (CFTC) Christopher Giancarlo believes that the fact of filing such a patent application testifies to the readiness of private companies to work with the state to formulate new methods of functioning of money.
“When the United States takes on a serious matter, like space programs or the Internet, they involve the private sector in cooperation,” he explained.
Recall earlier, the IMF proposed to attract private companies to launch CBDC. Synthetic digital currency of the central bank (sCBDC) on the basis of public-private partnership assumes to leave the issue and support of stable digital currencies to private issuers, and the Central Bank will protect the assets of their customers.