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MasterCard to open up network to cryptocurrencies

reuters.com

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Re: MasterCard to open up network to cryptocurrencies

#151

Post by function_seven »

hanniabu wrote: post #111
liquidify wrote: post #27

Earlier quoted context omitted.

They couldn't do that. If they didn't actually have any crypto, in the event of a large scale increase in price combined with a large scale cash out, Paypal would have to eat the difference from buy to sell price. They would lose their shirt. At minimum, Paypal is buying some percentage of the crypto sales in actual crypto to act as a hedge. However, it is more likely they are closer to 1 to 1 backing since they prob…

> Paypal would have to eat the difference from buy to sell price. Why? If they never offer withdrawals then they don't need to worry about that.

If I buy a BTC for $30,000, then later decide to sell it for $47,000, Paypal will lose $17,000 if they didn't actually have a BTC somewhere in their vault.

This is the same idea as bucket shop operations that "trade" stocks with their clients without actually processing trades on any exchange.

When prices are rising, with new buyers available, then a bucket shop can do just fine for themselves. As soon as they have more sellers than buyers, at a price higher than they came in, the shop is the one that has to cover the difference.

Re: MasterCard to open up network to cryptocurrencies

#152

Post by toomuchtodo »

X6S1x6Okd1st wrote: post #120
systemvoltage wrote: post #84

Earlier quoted context omitted.

What's the point of an unstable, volatile, frantically manipulated currency that is susceptible to social media pump and dump schemes (Elon + Doge)? Currency and its exchange rate needs to be relatively stable for the world to put trust into it. Saying that BTC is stable, but the rest of the world's fiat currency is fluctuating makes no sense. US dollar provides stability and security, I feel confident that a cappucc…

It's kind of moot w.r.t. MasterCard. They will only accept stablecoins which are generally pegged to usd

Someone’s bonus and job depends on them appearing “innovative”.

Re: MasterCard to open up network to cryptocurrencies

#153

Post by arcticbull »

throwaway20875 wrote: post #146
arcticbull wrote: post #137

Earlier quoted context omitted.

You haven't shared "the point" just a link to MicroStrategy, a failed software company whose CEO had to pay an $11 million dollar SEC settlement decades ago for cooking the books, making a desperate Hail Mary play buying near the top of a speculative mania in a bid to gain relevancy. MSTR is the new "Long Island Iced Tea" -> "Long Blockchain Inc" rebrand [1] Humorously enough, the same is roughly true of Tesla, a car…

>CPI is inflation Lol

Right, yeah, if you pretend how much AAPL appreciated matters to anyone, asset inflation counts. Otherwise, it's CPI, and [citation needed] if you want to posit otherwise.

Re: MasterCard to open up network to cryptocurrencies

#154

Post by nemo44x »

maceurt wrote: post #123

I am not big on cryptocurrency. Look how the price of these "currencies" fluctuate like crazy, because people buy and treat it like an investment. What is the actual current practical utility of cryptocurrency except for buying/selling illegal things online? People are so horny to get in on the next computer/iphone/etc that they forget that new ideas can fail.

A store of value protected from (and even a beneficiary of) government mismanagement, central bank mismanagement, corporate mismanagement, etc.

Because we are forced to generally keep our wealth in things susceptible to political influence it’s nice to have a place to store value away from that.

My homes value can be wrecked by a variety of government or central bank policies. Same with my equities and bonds. So having a part of your wealth in BTC is frugal as a protection from these things. It is outside the scope of these influences.

Re: MasterCard to open up network to cryptocurrencies

#155

Post by raiyu »

BTCOG wrote: post #147
janoside wrote: post #116

Earlier quoted context omitted.

What's the point, you ask... Here is Ross Stevens, CEO of Stone Ridge Asset Management, describing "the point" for an hour: https://www.microstrategy.com/en/bitcoin/videos/bitcoin-macr... It sounds like you've made up your mind about Bitcoin, but I believe you've missed the big picture. The above video, if you watch it with an open mind, will help you to glimpse it. Hint: it's not about cappuccino, it's about living…

These people are all disingenuous actors. They know the point, but they want to flood all of these threads and act clueless. Bitcoin is digital gold, gold's replacement. It's been here for 12 years and yet, all these actors show up in every Bitcoin thread. It's the greatest monetary shift in hundreds of years. ArcticBull below me shows up in EVERY single Bitcoin thread to trash talk Bitcoin. Here's where we are at; s…

Bitcoin is a modern day example of what happens when you have a currency that has deflation instead of inflation at it's core.

It becomes actually more expensive to buy anything in the present, as a result, consumers stop purchasing, and as a result economic activity decreases.

DigitalGold is also non-sensical, because that is simply designed to track against inflation, to prevent the loss of today's buying power tomorrow because of inflation. But when something appreciates 10,000x it's not really a hedge against inflation anymore, but a different speculative instrument entirely.

Re: MasterCard to open up network to cryptocurrencies

#156

Post by 14 »

PragmaticPulp wrote: post #74
runeks wrote: post #51

Earlier quoted context omitted.

> Should also note that MasterCard crypto transactions almost certainly won’t be settled on the blockchain. Not with $8 Bitcoin transaction fees. They could easily settle merchant balances on the blockchain. An $8 fee is nothing compared to the revenue of a merchant. Assuming e.g. a 1.5% credit card fee, a merchant pays $8 in fees when receiving ~$500 in payments.

You’re ignoring the consumer’s transaction fee for making the purchase in the first place. Who pays that? Even if you turn this into a credit card that a consumer pays off once a month, how many consumers want to pay $8 for the privilege of paying their credit card bill? Also, $8 is just the current transaction fee, with virtually zero vendors accepting Bitcoin. If Bitcoin became popular, the transaction fees would b…

Wouldn’t MC just buy thousands of BitCoins then just keep track of how many they owe you and not actually interact with the block chain every time?

Re: MasterCard to open up network to cryptocurrencies

#157

Post by devname »

PragmaticPulp wrote: post #2

These stories usually spur more enthusiasm for buying cryptocurrency, but ironically those buyers aren’t interested in spending cryptocurrency using their MasterCard. They’re hoping other people will buy cryptocurrency from these announcements, driving the price up. Or, more likely, they’re just hoping other people will buy cryptocurrency and not use it in these spending systems. Spending cryptocurrency would result…

I want people to earn and spend Bitcoin Cash. Almost all bitcoiners want this.

Re: MasterCard to open up network to cryptocurrencies

#158

Post by BitwiseFool »

leighfuu wrote: post #134
cesarb wrote: post #110

Earlier quoted context omitted.

I've seen this said a lot, but in my experience whenever a merchant has different prices for cash and credit card, the cash price is always lower. So whatever the merchant is paying to Visa and/or MasterCard, it's more than it costs to handle cash.

Traditionally the discount for cash in many professions is due to avoiding tax. i.e. a plumber will do a job for cheaper if they are paid in cash as they won't be declaring that work in their accounts - avoiding the ~20% tax that would be due otherwise.

While true, I know of many small businesses that give cash discounts because the credit card fees ruin the profit margin on small purchases. Sometimes they even lose money on transactions. For instance if you buy a scone for a $1.05, the credit card fees alone might come out to 38¢ for the merchant. This is why you often see "minimum card purchase $5" at coffee shops and small businesses.

Re: MasterCard to open up network to cryptocurrencies

#159

Post by motohagiography »

Given their volatility and lack of a derivatives market to drive liquidity, I wonder what the banking capitalization requirements for crypto-currencies will be.

I can see the argument of "it's just another currency for exchange, how is this hard," but the difference today is it's super high volatility, without a rescue facility, and given bitcoin's public ledger of every bad person who has ever owned it, it is arguably less fungible than cash because MC would have to track the provenance of every block it had on its books.

Your mastercard probably won't be a bitcoin wallet either due to card chip capabilities, and I'd bet heavily they will just support it as another virtual currency and do your real bitcoin settlement asynchronously on their back end in a hypothecated and risk-managed form, and even then it will be a private ledger with their bitcoin capital levels levered way up.

IMO, the entire levered business model and capitalization requirements when applied to cryptos sets banks up for the squeeze to end all squeezes, like when countries demand delivery of their physical gold from bullion banks and it creates political instability, except next time it will be 4chan organizing to get delivery of their bitcoin. For an issuer to act as a bank maintaining a float of cryptocurrencies to facilitate settlement seems like a super interesting hard problem.

Edit: this will probably be handled by reserving the right to pay you in bonds or IoUs instead of bitcoin, just like paper gold and silver today, which reduces the usefulness of doing your BTC payments through them in the first place.

Re: MasterCard to open up network to cryptocurrencies

#160

Post by jerry1979 »

arcticbull wrote: post #137
janoside wrote: post #116

Earlier quoted context omitted.

What's the point, you ask... Here is Ross Stevens, CEO of Stone Ridge Asset Management, describing "the point" for an hour: https://www.microstrategy.com/en/bitcoin/videos/bitcoin-macr... It sounds like you've made up your mind about Bitcoin, but I believe you've missed the big picture. The above video, if you watch it with an open mind, will help you to glimpse it. Hint: it's not about cappuccino, it's about living…

You haven't shared "the point" just a link to MicroStrategy, a failed software company whose CEO had to pay an $11 million dollar SEC settlement decades ago for cooking the books, making a desperate Hail Mary play buying near the top of a speculative mania in a bid to gain relevancy. MSTR is the new "Long Island Iced Tea" -> "Long Blockchain Inc" rebrand [1] Humorously enough, the same is roughly true of Tesla, a car…

CPI probably doesn't reflect inflation the way Fed looks at it. They use PCE[1]:

>An accurate measure of inflation is important for both the U.S. federal government and the Federal Reserve's Federal Open Market Committee (FOMC), but they focus on different measures. For example, the federal government uses the CPI to make inflation adjustments to certain kinds of benefits, such as Social Security.[3] In contrast, the FOMC focuses on PCE inflation in its quarterly economic projections and also states its longer-run inflation goal in terms of headline PCE.

[1] https://www.stlouisfed.org/publications/regional-economist/j...

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