Mastercard vice-chair Ann Cairns in a recent conference said Bitcoin is too volatile for its upcoming crypto payment services that the company announced earlier this month. Cairns believes Bitcoin in its current form is too volatile and slow to be a form of payment. She said,
“Bitcoin doesn’t behave like a payment instrument, It’s too volatile and it takes too long to transact.”
“So if you and I went for a cup of coffee, and you know, I decided to pay with bitcoin, our coffee might cost me, I don’t know, 40% more by the time it was served — and it takes 10 minutes to actually settle the transaction,”
Mastercard earlier this month announced it would offer crypto payment services via its platform. The announcement is quite considerable given Mastercard’s market reach would help further the crypto adoption.
Is Mastercard Eyeing Stablecoin Market?
Mastercard’s upcoming crypto payment service would mainly comprise of stable coins especially after the recent Federal regulations in the form of the Stable Act allowing Federal banks to indulge in stablecoin issuance and transactions. The US Federal bank has now prioritized stablecoin development and issuance, which could also be the reason behind the payment processing giant’s decision to indulge in stablecoins.
Mastercard’s decision to exclude Bitcoin from its payment servicers giant is understandable as Bitcoin has grown more popular as a digital gold store of value asset. Institutions like Microstrategy and Tesla are using it as a treasury reserve asset. Even prominent institutions and gold investors are cutting their exposure in the lustrous metal to invest in Bitcoin. One of the oldest investment firms in the US Franco Nevada called Bitcoin the new inflation hedge.
— Documenting Bitcoin ???? (@DocumentingBTC) February 25, 2021
The vice-chair of MasterCard also believes Bitcoin is more like Gold and acts as a hedging asset rather than a payment instrument. Many Bitcoin proponents would disagree especially with the layer-2 solutions such as the Lightning network has gained traction for use of Bitcoin as a form of Payment.