During the rise in crypto assets, traditional financial institutions like VISA and Mastercard scrambled to get in on the trend and announce new initiatives involving Bitcoin, Ethereum, or other cryptocurrencies.
Those same companies are now rethinking their strategies after the collapse of FTX and additional negative industry events, according to a new report.
Report: VISA & Mastercard Put Crypto Plans on Pause
An anonymous source told Reuters that VISA and Mastercard have canceled plans to launch crypto-centric services until global financial regulators establish clearer controls to prevent situations like the one that happened last November involving FTX.
VISA’s spokesperson made a confident statement that the company’s cryptocurrency strategy will not change, but called the failure of companies like FTX, BlockFi, Celsius and others, “an important reminder” that there is “a long way to go before crypto becomes part of mainstream payments and financial services .
Mastercard does not offer similar support for cryptocurrency, but instead focuses on the underlying blockchain technology. The credit card giant claims blockchain will “help solve current pain points and build more efficient systems.”
Collapses like these are keeping companies away from the nascent industry | TOTAL on TradingView.com
Post Fallout Impact on Top Paying Brands
These brands have been linked to failed cryptocurrency businesses, which can lead to costly consequences. For example, VISA has a credit card agreement with FTX, and BlockFi issued a Bitcoin-back rewards credit card that began to become unusable post bankruptcy.
Outside of card partnerships, VISA has been looking to Ethereum as a digital payment settlement layer. Mastercard has an entire website landing page dedicated to explaining in detail how the company approaches “crypto and blockchain,” providing useful statistics that highlight the positive potential of cryptocurrencies for digital payments.
Both companies hope to adapt to the digital payments landscape quickly.
Bitcoin & Ethereum: Disrupting Digital Payments
In related news, at $23,500 per coin, Bitcoin’s total market cap is worth just $12 billion less than VISA, and more than $100 billion more valuable than Mastercard.
By 2022, VISA will process more than $6 trillion in total value and Mastercard $2.5 trillion. Meanwhile, Bitcoin processed more than $8 trillion at the same time. Last year when DeFi and NFT were all the rage, Ethereum processed more than 4.5 times the total value of transactions that VISA did.