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Visa to Allow Direct Payment of Ethereum Gas Fees with Credit Cards

Visa (NYSE: V) has announced that they will be using the current standard for Account Abstraction (ERC-4337) on Ethereum (ETH) to allow users to pay for their transaction’s gas fees directly with a Visa credit card. The move is expected to allow users to avoid the complex process of paying for transactions or operations on blockchains, one of the major obstacles of crypto adoption. Visa has emphasized the simplicity and ease of adoption of this solution, which will allow users to avoid the need to hold native blockchain tokens or constantly engage in bridging tokens to cover gas fees. This move could drive adoption of blockchain technologies and make it easier for users to engage with Ethereum blockchain technology.

Visa’s Proposed Solution

Visa announced that the proposed solution puts the paymaster at the heart of the process, a specialized type of smart contract account that can sponsor gas fees for user Contract Accounts. Using this solution, a user who wants to make a $200 worth purchase on a merchant’s website using Circle USD, but only has 1,000 USDC and no ETH, would initiate the blockchain transaction in a self-custodial wallet that supports ERC-4337, and chooses ‘Visa Card’ for gas fees. The system would process the payment, paying the gas fees on the user’s behalf, allowing the transaction to be successfully sent to the Merchant’s wallet.

Challenges to Crypto Adoption

While Visa’s announcement is a significant step towards blockchain technology adoption, the vast majority of available cryptocurrencies still require users to pay transaction fees. Several projects are looking to solve the fee issue on a protocol level, by completely removing transaction fees. Nano (XNO) and IOTA (MIOTA) are some of the projects currently working towards this goal.

SourceFinbold

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