Visa’s experimental solution simplifies blockchain transactions by introducing credit card payments to cope with fluctuating Ethereum gas fees.

Visa has made significant progress in streamlining blockchain transactions. The payments giant has been working on an experimental solution that would allow on-chain gas fees to be paid using Visa cards, which could be a game-changer for users.

VISA Product Manager Mustafa Bedawala shared the publication while detailing a glaring issue with crypto wallets; the ongoing need to manage ETH balances to pay gas fees.

The typical process for using Ethereum requires users to purchase ETH on an exchange or through an onramp service and then transfer the ETH to a wallet to ensure that it is sufficient to handle fluctuating gas fees. Constant changes in gas prices often result in users either paying too much or running out of ETH supply, adding a layer of complexity and friction.

Visa card payment for gas fees

The solution proposed by Visa leverages Ethereum’s ERC-4337 account abstraction standard and a feature called a “paymaster” smart contract that facilitates off-chain gas fee payments. The process is expected to proceed as follows:

1. The user initiates an Ethereum transaction through the wallet, and the wallet then sends the transaction details to the Payment Master Network Service.

2. The web service calculates the gas fee and then charges the user's Visa card using Visa's Cybersource system to process the card payment.

3. The web service then sends the digital signature back to the wallet to approve the payment. The approval is valid for a specified time frame.

4. The wallet appends this signature to the transaction and forwards it to Ethereum.

5. The payer smart contract then verifies the validity of the signature and pays the Gas cost of processing the transaction.

Source: Visa

This series of steps allows users to pay gas fees directly off-chain using their Visa cards, eliminating the need for users to hold ETH solely to pay fees. This strategy significantly simplifies the user experience and makes transactions more convenient.

Visa has tested this concept on the Ethereum Goerli testnet using existing open source tools such as Stackup’s userop.js library. The test transaction successfully paid the fee through the payer without requiring ETH.

Notably, this concept has huge potential to reduce friction for blockchain users. Wallet providers or merchants using Paymaster solutions can allow users to pay gas fees using Visa cards.

Bedawala also hinted at wider implications, noting that merchants or dApps can leverage payment master settings to enhance customer experience, making it possible to pay for gas using Visa cards. The solution could also pave the way for existing wallets and payment providers to offer a way to pay gas fees using Visa cards. #Visa #Gas