Visa Says No To Bitcoin Payments
Visa won’t be processing bitcoin transactions any time soon, as the world’s largest credit card company maintains a firm stance against cryptocurrencies. According to the company’s top hierarchy, bitcoin is not real money to justify its inclusion in the network.
Remarks by the company’s CEO, Alfred Kelly, all but casts doubt on whether bitcoin and other cryptocurrencies will ever find their way into the mainstream financial industry. According to the executive, Bitcoin is not a payment system but a commodity that people can invest in.
“I don't view it as payment system player. We at Visa won't process transactions that are cryptocurrency-based. We will only process fiat currency-based transactions,” said Mr., Kelly at the National Retail Federation Conference.
Visa’s subsidiary, Wavecrest, has already terminated credit cards of dozens of European crypto card companies, maintaining they did not comply with its compliance rules. Cards such as BitPay, CryptoPay, and Bitwala have been suspended as providers embark on the process of returning funds to users.
The cards allowed users to make payments using fiat currencies but were funded by payments from Bitcoin and Ethereum wallets. The termination triggered talk that may be Visa was afraid of the threat posed by bitcoin. The company however fought back insisting it does not feel threatened in any way, given that it processes over 100 billion transactions a year compared to130 million by bitcoin.
The stance has gone a long way in triggering a sell-off the popular cryptocurrencies. Even though Bitcoin is up by more than 1000% year-to-date, a plunge from record highs of $19,000 to under $10,000 mark, shows all is not well in the industry. Visa position on cryptocurrency raises serious doubt about whether cryptocurrencies will ever find their way into the mainstream industry.
Visa has emerged as the latest opponent to bitcoin, as corporate giants continue to air their reservations. JPMorgan CEO, Jamie Dimon was the first to air his criticism terming the digital currency a ‘fraud’, a stance that he has since softened. Former Wells Fargo CEO, Richard Kovacevich, has, on the other hand, termed the cryptocurrency a pyramid scheme.
"I think it's a pyramid scheme. It makes no sense. I'm just surprised it isn't even lower. “I’ve never called it a fraud. Everyone knows what’s going on. You’re betting that somebody’s going to buy it—and some people have been right,” said Mr. Kovacevich.
Bank of America branch Merrill Lynch issued a statement saying its financial advisors are not allowed to place client’s funds in bitcoin-related investments.
A number of countries have also aired their reservation about cryptocurrencies activities. China and South Korea which account for the largest amount of cryptocurrencies activities are believed to be in the process of passing legislation that will regulate the industry. The sentiments have hit hard, the price of Bitcoin seen by consecutive days of double-digit losses.