Cross-chain bridge for various countries' CBDCs? Visa develops global payment channel based on distributed ledger.

Visa has developed a conceptual protocol to facilitate cross-border payments for digital currencies issued by multiple central banks. Known as the Universal Payments Channel (UPC), this solution for global payment channels has already been tested on the Ethereum testnet and features underlying smart contract configurations.

Visa's Blockchain Payment Network: UPC

In Visa's UPC whitepaper, it states that it adopts a "hub-and-spoke model" to create a scalable and interoperable platform. Users need to register with a UPC hub network center to transact with other users. Visa also emphasizes that this network is trustless, efficient, and cost-effective.

The operation of UPC involves a process where when a party wants to send funds via UPC, they must first register their public key with the server, which is the hub. They will then open channels with other registered users and engage in transaction interactions through smart contracts and their set parameters deployed on UPC. When one or both parties wish to settle off-chain, the channel will close.

Cross-Border CBDC Payments with Different Countries' Ledgers

Visa assumes that each country's Central Bank Digital Currency (CBDC) has its own independent distributed ledger technology (DLT) and can support basic smart contract execution. UPC will act as a bridge between wallets of both parties to transfer different CBDCs. Visa mentions that in order to process a large number of transactions simultaneously, they use cryptographic techniques similar to Raiden payment channel network.