Global payments giant Visa published a proposal that would enable Ethereum owners to set up automatic payments from their self-custody wallets eliminating banks and other centralized entities from the equation.
In the paper sparked by an internal company hackathon held earlier this year, Visa that StarkNet, a layer 2 blockchain built on top of Ethereum, could help bridge the gap between crypto and the real world by allowing users who use self-custodial wallets to pay their bills more easily.
A Visa team of researchers and engineers is evaluating the foundations of various blockchains. The areas of focus include security, scalability, interoperability, privacy, and use cases of different protocols.
To implement automatic payments, Visa proposes using “Account Abstraction,” an Ethereum feature that core developers are currently considering.
We propose a new solution towards a real-world application of auto payments to demonstrate how to write a smart contract for a self-custodial wallet that can pull funds automatically, instead of requiring the user’s active participation each time to instruct and push payments on a blockchain.
the proposal reads.
Ethereum Co-Founder Vitalik Buterin proposed Account Abstraction in 2015. The same authorizes Ethereum-based wallets and smart contracts to be combined into a single account. According to the company, this allows users to set up recurring bill payments.
“With AA, one could setup pull payments with a delegable account instead of push payments on the backend” Further elaborating on the essence of AA, Visa’s Head of Central Bank Digital Currencies and Protocols, Catherine Gu Tweeted.
For a self-custodial wallet, the user controls the private key and so for each tx, this requires the active participation of the user to initiate payment to push onto the blockchain.— Catherine Gu (@catgu_) December 19, 2022
Visa observed that Ethereum has not yet implemented Account Abstraction. The most recent EIP-4337 claims a way to do AA without Ethereum protocol changes, and there is still debate on how AA should be implemented on Ethereum. In light of these constraints, Visa implemented delegable accounts on StarkNet, an Ethereum layer-2 network that extends the functionality of the base blockchain to support the feature.
Though Visa presumably produced a working auto-payments solution, it did not announce that it would offer the feature to its clients.
Visa has long been interested in cryptocurrencies and has formed several partnerships with companies such as Circle and Crypto.com. Earlier this year, the payment giant hosted a hackathon focused on blockchain technology exploration.