Visa has introduced its new Visa Tokenized Asset Platform (VTAP), a business-to-business solution designed to enable banks to issue fiat-backed tokens on the Ethereum blockchain. Announced on October 3, VTAP represents a significant step in Visa’s efforts to bridge traditional banking with blockchain technology, allowing financial institutions to expand their digital payments capabilities.
Visa stated that VTAP will help banks mint, transfer, and manage fiat-backed tokens like stablecoins and central bank digital currencies (CBDCs). According to Visa, this innovation builds on the company’s digital payments and smart contracts expertise, allowing banks to connect fiat currencies to blockchain networks.
Banks adopting VTAP
Some banks are already using Visa’s VTAP. Spanish bank Bilbao Vizcaya Argentaria (BBVA) is among the first to test the platform’s functionalities. BBVA plans to run a live pilot in 2025, allowing select customers to experience the benefits of blockchain-based financial services.
Francisco Maroto, BBVA’s Head of Blockchain and Digital Assets, highlighted the significance of this partnership, stating that VTAP will help the bank explore blockchain’s potential. This collaboration is expected to pave the way for new financial solutions and extend BBVA’s banking services into blockchain-driven offerings.
Key features of VTAP
Visa emphasized that the VTAP platform is designed to be simple for banks to integrate. The platform supports programmability and interoperability across multiple blockchain networks, making it a versatile tool for financial institutions. Banks can already use VTAP to perform key functions such as minting, issuing, and burning fiat-backed tokens.
The platform’s future potential is promising. Visa envisions that VTAP could be used for trading tokenized real-world assets, streamlining transaction settlements on-chain, and enabling faster interbank transfers. By automating transactions, VTAP could make cross-border transfers and on-chain settlements almost instantaneous, bringing significant efficiency to the financial industry.
Visa’s blockchain strategy
Visa’s launch of VTAP is part of its broader strategy to integrate blockchain into its operations. The company has been exploring blockchain technology through various pilots, including experiments with CBDCs. Visa’s Global Head of Innovation and Digital Partnership, Vanessa Colella, noted that VTAP is another step in the company’s leadership in the digital payment space.
Visa’s main competitor, Mastercard, has also worked on blockchain-based solutions. Recently, Mastercard launched a Bitcoin debit card in Europe, demonstrating its ongoing interest in blockchain and crypto. These developments reflect a broader trend among traditional financial institutions to explore tokenization and blockchain technologies.
The focus on tokenized assets and interoperability is growing across the industry. In addition to Visa, Swift, the global banking messaging service, has also been working on solutions to connect banks with blockchain networks. Swift is in the pilot phase of enabling tokenized asset transactions, further highlighting the financial industry’s shift toward integrating blockchain technology into traditional systems.