The world's largest card company just doubled down on its bid to capture the cryptocurrency market. Visa announced today that it has launched a crypto advisory practice for its clients and partners under its division Visa Consulting and Analytics (VCA).
The news comes just a few months after Cuy Sheffield, head of crypto at Visa, declared that the asset class had gone “great” at a fintech conference. The payment giant caused a sensation when he bought a CryptoPunk NFT, but his decision to launch a dedicated cryptocurrency consultancy shows that his attempts to capture a share of the cryptocurrency market are a crowded field and extend beyond marketing gimmicks.
Visa's partnerships with crypto platforms have doubled in recent months, Sheffield said. Consumers have also spent about $3.5 million using Visa's crypto card programs, Sheffield said, and above $1 million in July alone.
He also announced the results of a new global survey he conducted on consumer attitudes about cryptocurrencies, which showed that 40% of more than 6,000 respondents would likely switch primary banks to one that offers crypto products.
Visa has received “an incredible number of calls from hundreds of customers and partners and traditional financial institutions” looking to integrate crypto into their offerings. Visa's consulting arm has around 700 employees, although the company did not share how many would be affiliated with the crypto practice.
“We see Visa well positioned as a global brand neutral, with deep crypto expertise, that can help abstract some of the complexity from these new technologies and help banks incorporate them into their core products,” Sheffield said.
To that end, Visa invested in blockchain compliance firm TRM Analytics by participating in its Series B of 60 million. American Express and Citi also participated in this round. Visa is just one of many cardholders struggling to get into crypto, threatening its fee-dependent business model by replacing it as the new underlying infrastructure for payments.
Mastercard, for its part, has a cryptographic rewards program, using Bakkt as custodian of digital assets. Visa also does not hold cryptocurrencies in escrow directly, but partners with AnchorageDigital to offer that capability, a company it had already invested in in 2019. Visa is building its crypto API platform on top of Anchorage, which allows other banks to access its custody services.
Sheffield anticipates growth in Visa's cryptocurrency-linked debit card programs, as well as in use cases such as central bank digital currencies (CBDCs). Although only seven countries have launched CBDCs to date, 87 more are considering them, according to The atlantic council.
Visa hopes to capitalize on this interest by helping banks develop CBDC-related products.
“We have spent a lot of time researching what infrastructure CBDCs would use for consumer experiences and how consumers would interact with them. We are learning from that experience and the engagements we are having with central banks and helping banks start to think about their role in enabling as we believe there will be a number of countries that will end up going down this path,” Sheffield said.
