The payments giant described its approach in a blog post on December 19, in which using Account Abstraction, an Ethereum feature, to implement automated payments. This type of Ethereum account allows the conversion of accounts into smart contracts, which can automatically detect valid transactions, pay gas fees, and initiate transactions. Vitalik Buterin also mentioned this term previously.
The new feature will allow users to set up recurring bill payments. Ethereum does not allow this at a basic level, as automated smart contracts cannot request transactions. Instead, the user account must manually initiate and submit transactions.
Visa noted that although bank accounts and custodial crypto wallets can be easily used to arrange auto-payments, this type of payment is “not as straightforward to execute on a blockchain.” As such, implementing the feature in a self-custodied wallet is a challenge.
By using Account Abstraction, it is possible to combine the functions of user accounts and smart contracts into a single type of Ethereum account. The company called the resulting account a “delegable account.”
Visa added that Ethereum itself has yet to implement Account Abstraction, which exists as part of various proposals, such as EIP-4337. For those limitations, Visa has implemented proxyable accounts on StarkNet, a layer 2 network for Ethereum to extend the base blockchain’s functionality to support this feature.
While Visa seems to have created an automated payment solution, that doesn’t indicate it will offer this feature to its customers.
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