To enable consumers to directly pay for gas using Visa credit cards, Visa has announced plans to incorporate the existing standard for Account Abstraction on the Ethereum blockchain. This advancement promises to make paying for blockchain transactions less complicated and may hasten the adoption of blockchain technologies.
Gas fees, representing costs linked to Ethereum transactions and activities, pose a substantial hurdle in the cryptocurrency market. Even transactions involving stablecoins like Circle USD (USDC) currently require payment in Ethereum’s native currency, ETH.
Visa’s solution enables Visa credit card payments for gas fees, including in self-custody wallets like Metamask. For instance, a user purchasing $200 Circle USD initiates a self-custodial wallet transaction, opting for “Visa Card” gas payment. The payment would cover the gas cost, enabling the transaction to proceed.
Visa Innovative Paymaster Strategy Aims to Streamline Cryptocurrency Transactions
The key component of Visa’s plan is the idea of a “paymaster”, a specific kind of smart contract account that finances gas costs for user Contract Accounts. The innovative approach eliminates the need for holding bridge tokens for gas fees, streamlining the user experience and boosting adoption.
This approach represents a huge step toward expediting cryptocurrency transactions, despite the fact that it is experimental and has inherent hazards. Caution is advised when users engage with these functions.
Many users still struggle with transaction fees while using other cryptocurrencies, despite this development. Initiatives such as nano (XNO) and IOTA (MIOTA) aim to eliminate transaction fees by addressing protocols.
Visa’s efforts benefit blockchain, yet the industry seeks innovative methods to enhance Bitcoin transactions’ convenience and affordability. Reducing or abolishing transaction fees could promote widespread cryptocurrency adoption, contingent on sustained exploration and innovation.