On February 10, MasterCard announced that it would begin supporting select cryptocurrencies on the payment network. According to the payments giant, the inclusion of cryptocurrency will allow customers to “store, store and send money in a new way,” as well as open new opportunities for merchants.
The announcement comes after a presentation on January 30 in which Visa confirmed its plans to continue pushing cryptocurrency payments and ramp up growth, indicating that the company has long-term plans in this sector. With both credit card giants on board, it’s safe to say that Bitcoin (BTC) is no longer just an experimental form of “internet money”, but a new asset class – one that remains.
Mastercard and Visa’s entry into cryptocurrencies is just one example of a growing wave of traditional payment and technology companies delving into bitcoin as an investment, payment method, or investment vehicle, but these two companies account for billions of payments made each year.
So what does this mean for Bitcoin in particular and for cryptocurrency in general? Some say the industry may not yet exist, but this latest development could be the start of a regular rollout. Ton Weiss, Bitcoin analyst and organizer of the “Unconfiscatable” Bitcoin conference, told Cointelegraph:
“Bitcoin has yet to enter the adoption phase, it is still in the speculative / investment phase. The biggest news is that Elon Musk and Tesla have bought Bitcoin as a strategic reserve instead of cash. Mastercard and Visa are interested in this first step of actual implementation for users, but when users really get started. In comfortably using / using / receiving bitcoins through Lightning, they are gradually starting to abandon Visa and Mastercard.
Gatekeeper effect: Let the bulls in
When the Mastercard was announced, Bitcoin was trading at $ 46,400. Since then, the cryptocurrency has jumped to a new permanent high of over $ 58,000, and the news has undoubtedly played a role.
Additionally, a week after the announcement, the first North American listed fund was approved by the Ontario Securities Commission. In the first trading hours, volume approached $ 100 million.
Another Bitcoin ETF has been approved by the regulator in Ontario and is expected to reach $ 1 billion in assets under management by the end of February. Additionally, the world’s largest trustee bank, New York Mellon Bank, has announced that it will launch a cryptocurrency custody service. Then the world’s largest asset manager, BlackRock, confirmed that it was operating with Bitcoin.
Not only that, all the attention on Bitcoin has now been focused among the traditional money giants and among the retailers of Reddit investors. “Crypto Twitter appears to be the happiest corner of the social platform, with laser eyes and it doesn’t capture everyone in cryptocurrencies streamed into the world’s richest man and two members of the US Congress,” Ben Chu, CEO of Bybit, told Cointelegraph, he adds:
“This harmony with positive signals creates retail demand and creates a good cycle. We can see that the increased interest is reflected in the increase in the number of fiat currencies and the trading volume of Bybit.”
The MasterCard announcement came at a time when the number of confirmed payments daily on the Bitcoin network was steadily increasing. The number of payments in the network is defined as the number of recipients who receive money as part of the transaction.
The account highlights the value of the Bitcoin network as a secure way to transfer money without the participation of third parties. Over the past twelve months, the number of confirmed payments per day has increased from an average of 500,000 to 869,000.
What this means for cryptocurrencies
So what do Mastercard and Visa’s efforts mean for the cryptocurrency world? As of the fourth quarter of 2020, there are 246 million MasterCard credit cards in the United States and 966 million worldwide, while Visa indicates that there are 3.5 billion cards in use worldwide and that the network processes more than 140 billion transactions annually.
The two companies have different plans for how to introduce cryptocurrency payments into the world of credit card transactions, and the ads have not received an answer to many questions, including exactly how the integration will work.
In the Mastercard announcement, it became clear that the cryptocurrency would hit the network this year, but it did not specify when or what currencies would be available. The payment giant indicated in its announcement that Stack coins could be the first on the network, but others could follow.
In his blog, Executive Vice President of Digital Assets, Blockchain Products, and Mastercard Partnerships, Raj Damudharan, indicated that the company will evaluate potential cryptocurrencies, including leveraging the concept of “blockchain partnership principles” they released after leaving Libra As.