Ethereum and VISA don’t seem to have much in common, especially since they’re different networks. Ethereum is a decentralized blockchain with a singular point of command and is maintained by nodes all over the world. On the other hand, VISA is a centralized business known for decades. Each has a different target audience and provides specific services, but there is something that brings them together.
Lately, Ethereum and VISA made it possible for collaboration to flourish, as VISA saw the opportunity from a typical target audience. Some types of customers want to leverage their coins and buy Ethereum p2p through a centralized and secure system that is also renowned for its reliability and history.
This movement would not only propel VISA into a new market. Still, it would also offer Ethereum a ramp for regulation as it would get the attention of governments seeing that it works along with a centralized product.
Regardless of the possible agreement, Ethereum seems to be behind VISA regarding the speed and quality of transactions, which is why many compare them. Let’s see what it’s about.
Ethereum vs VISA scalability and why it matters
Ethereum and VISA can’t be compared in regard to plenty of aspects. Still, when it comes to scalability, it’s safe to say that VISA better developed this sector, considering its presence on the market for such a long time. On the other hand, Ethereum has always been known for having scalability issues, for which multiple updates underwent the blockchain.
The scaling solution for Ethereum, Optimism, has recently made its arrival into the network. Moreover, several rollups that establish zero-knowledge cryptography are set to make the blockchain simpler and more accessible. Let’s not forget about the Merge update that made Ethereum sustainable by almost 99.98% and also solved some of its more minor issues.
Why is scalability so important to Ethereum? Because the sudden increase of users on the network is leading to congestion, transaction prices are increasing, and users find it difficult to undergo their usual coin transfers because gas fees are sometimes exceeding the transferred sum.
Transaction race before numerous Ethereum updates
Before Ethereum got into the spotlight, it was barely processing 20 to 30 TPS. Meanwhile, VISA was processing an outstanding number of 24,000 TPS. Considering this situation, VISA considered it beneficial to team up with Ethereum and allow its holders to set up automatic payments through their digital wallets and helped by the centralized company to avoid the need for banks and other financial institutions. This would not only appeal to Ether customers but would also allow interested individuals to dwell in the world of crypto through a secure and regulated system.
This collaboration would make it possible for the merge of a single account where crypto is stored through programmable smart contracts. Basically, a smart contract would be turned into a wallet so that users can benefit from both services in only one system.
Currently, Ethereum is slowly catching up in the speed and the number of transactions, having reached around three trillion dollars’ worth of them, similar to VISA. In 2021, it was shown how Ethereum processed 4.5 times more transactions than VISA, a considerable improvement compared to the pre-pandemic situation.
Why is this collaboration so important?
While VISA doesn’t need any introduction and it’s got plenty of users worldwide, reaching another target audience as the first centralized system would surely make it known for something more. On the other hand, Ethereum needs some more media coverage because even though it’s the second cryptocurrency on the market and famous for introducing smart contracts, it seems to be far from being regulated and adopted worldwide. Bitcoin, however, has been discussed for some time to be added as legal tender in more countries because it’s been some time since its release and has performed well until now. Its value increases with each halving, and we expect it to become even greater in the following years.
Bitcoin has already collaborated with companies like Microsoft, VISA and Google, increasing its popularity. At the same time, it provided companies and governments with more trust, encouraging them to adopt this technology. This is also why it’s more likely for Bitcoin to become legal tender in the near future.
Still, cryptocurrency needs to be regulated first
Despite Bitcoin being famous and more reliable, it seems there are some challenges on the way that need to be solved only through financial institutions. Unfortunately, the involvement of central authorities is required for these digital assets to become legal or at least not banned permanently from countries.
There are some ongoing approaches to how crypto can become accessible for regular users without the risk of volatility. For example, El Salvador tried making Bitcoin legal tender. Still, the situation in the country makes it almost impossible for citizens to use it because a considerable part of them don’t even have access to the internet or own a smartphone. Other countries also tried this approach, but it seems too direct for places in development because the system needs a suitable technological base for it to perform well.
However, crypto is taxable, so investors and users must declare their income yearly and pay for a certain amount of money if their investments exceed a specific sum placed by the government. There’s also a lack of information and guidance in this sector because authorities need to categorize these coins into commodities and securities, which isn’t an easy task. For example, Bitcoin is regarded as a commodity since it benefits from its growth, while Ethereum and other crypto assets are seen as securities. This might be because all other coins leverage Bitcoin’s circulation system and are taking advantage of its value.
What’s better, Ethereum or VISA?
Ethereum, the second cryptocurrency on the market and VISA, the biggest multinational company, are looking to merge their efforts into becoming one of the most potent tools for investors and regular users who want to benefit from crypto transactions faster and with less complex involvements from centralized institutions.
