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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

#291

Post by Sargos »

koonsolo wrote: post #218
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…

Mastercard just tries to be relevant in an environment where they will not be relevant anymore. Just look at the Nano cryptocurrency for example: 0 fees and Crypto is going to disrupt a lot of things. If it's not clear by now, you will be in for a surprise.

Mastercard is a payment support platform. They take the burden off of the business owners and let them focus on their business instead of the minutia of interfacing with the financial system. That doesn't go away with cryptocurrencies. In fact it might be more needed than ever as there are now multiple payment networks with lots of intricacies such as coin storage, keeping track of transactions for taxes, etc.

Visa and Mastercard are likely still going to be important in the future just for the sheer fact that business owners will take at least a decade to update their backend stack to be sophisticated enough to handle the various payment APIs, UX problems, etc that crypto brings. With Visa and Mastercard your existing PoS terminals still work (now with crypto) and you can continue focusing on selling books or groceries or whatever else you do instead of being a financial systems engineer.

Re: MasterCard to open up network to cryptocurrencies

#292

Post by scsilver »

PragmaticPulp wrote: post #169
scsilver wrote: post #89

Earlier quoted context omitted.

These currencies will inflate in value as their network grows wider. Each new user adds value like a telephone network. Eventually, there will be a point where everyone who wants to be connected is connected, they have bought the bitcoin they want and bitcoin prices reach an steady state. At that point, it should be stable enough to use as a currency.

It’s fascinating to watch MLM logic sweep the tech world. Get in on the ground floor of this opportunity, then convince all of your friends to buy in, then they convince all of their friends... Once the speculation upside is gone, why would anyone want to buy Bitcoin? That’s the real question.

Its not MLM its network effects. Every node added to a transactional network adds real world value to that network. Its etreamly evident in telephone networks.

The reason people would want to buy bitcoin once it has grown out of its speculation is the vast marketplace of people and vendors who accept bitcoin as tender + the use of bitcoin as a hedge against the inflation of your local fiat currency.

It becomes another investment vehicle to diversify with.

Re: MasterCard to open up network to cryptocurrencies

#293

Post by PragmaticPulp »

BitwiseFool wrote: post #158
leighfuu wrote: post #134

Earlier quoted context omitted.

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.

Yes, the fee is usually fixed cost plus percentage, which makes small transactions very expensive.

The small transaction problem is vastly worse with Bitcoin, though. The catch is that the transaction fee is paid by the buyer, so that $1.05 scone costs the consumer $8.05.

$1.05 goes to the consumer $8 transaction fee goes to the miner Some fraction (eventually most) of that $8 transaction fee goes to the energy company supplying the miners with electricity.

Now your $1.05 scone transaction includes the cost of charging a Tesla battery 3 times over, because that's how much energy went into the transaction on the blockchain.

Re: MasterCard to open up network to cryptocurrencies

#294

Post by ad31mar »

cortesoft wrote: post #198
krisdol wrote: post #175

Earlier quoted context omitted.

Full disclosure: I own about $11 worth of bitcoin if I round up a bit, so this might be biased. The most convincing "point" of bitcoin I've heard is to accomodate transfer of large sums of money across borders, quickly, with minimal transaction costs and oversight. Everyone here can afford the fee to transact 8 billion dollars worth of bitcoin. And settlement happens in seconds to a couple minutes. That's appealing t…

The price volatility is way more expensive than transaction cost, if you have billions of dollars.

It's usually in your favour tho.

Anyways, there are plenty of stablecoins if that's your thing and you can use Bitcoin (the network) for the rails only.

Re: MasterCard to open up network to cryptocurrencies

#295

Post by whimsicalism »

hackissimo123 wrote: post #215
tobias3 wrote: post #136

Earlier quoted context omitted.

Here in the EU, credit card transaction fees are capped at 0,3%. So no shenanigans, but cryptocurrencies would have to fall within this range as well.

Is that the case in the whole EU? Because my AmEx gives me 1% cashback here in the UK, and that's been true since long before Brexit.

https://www.gov.uk/government/news/credit-and-debit-card-fee....

Re: MasterCard to open up network to cryptocurrencies

#296

Post by kgwgk »

parliament32 wrote: post #261
ArtTimeInvestor wrote: post #4

The game Paypal currently plays with Crypto is the closest thing to printing money I have ever seen: Their users can "buy and sell Bitcoin" and pay "no fees". How does Paypal make money? "From the spread". The difference between bid and ask. And who sets the spread? Drumroll ... Paypal! Since you cannot transfer your bitcoins out, when you sell your bitcoins, Paypal pays you whatever they like. So far, Paypal only of…

Thing is this is exactly how it works with literally every other forex ever. If you go buy CAD with your USD from your local bank, of course they make money on the spread, the exact same way.

But you get the foreign currency! You can take it to a foreign country to spend it in blackjack and hookers.

That looks more like a bucket shop.

Re: MasterCard to open up network to cryptocurrencies

#297

Post by Sargos »

suikadayo wrote: post #121

Everyone on this thread seems to be missing the point that they’ll be working with stablecoins on Ethereum and other smart contracts chains, and not Bitcoin.

Hacker News is still trying to grasp Bitcoin so I feel like Ethereum is going to take another few years to even begin productive discussions.

Re: MasterCard to open up network to cryptocurrencies

#298

Post by PragmaticPulp »

pmontra wrote: post #162
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…

> Spending cryptocurrency would result in selling that cryptocurrency Not necessarily. I could give you the address of 0.001 BTC over the MasterCard network and you give me something I can eat (I don't know if this is how it will work, but why not?) No BTC is converted in fiat currency. You can hoard you BTCs for years or change them in dollars as soon as you receive them. Your choice. Edit: I must give you the priva…

Doesn't work.

You can't guarantee that you haven't memorized the private key. You can't guarantee you haven't traded the same key multiple times.

The only way the receiver can truly guarantee ownership of the BTC is to put it in a transaction, which costs money.

Re: MasterCard to open up network to cryptocurrencies

#299

Post by arcticbull »

rank0 wrote: post #271
arcticbull wrote: post #153

Earlier quoted context omitted.

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.

There's actually considerable debate on the subject. I find it reasonable that things which are outside the CPI basket can indeed experience inflation. https://www.investopedia.com/articles/07/consumerpriceindex.... If 25% of circulating USD were created last year, and our economic value is the same or even diminished, wouldn't it follow that there must be significant inflation?

> If 25% of circulating USD were created last year, and our economic value is the same or even diminished, wouldn't it follow that there must be significant inflation?

Not necessarily, no. The value of money is a function of supply and velocity. If the velocity went down and the supply went up 25% the fed can still nail its 2% target. [1, 2, 3] If the velocity increases next year the fed can shrink the supply commensurately to maintain its targets.

[1] https://www.investopedia.com/terms/v/velocity.asp

[2] https://www.stlouisfed.org/on-the-economy/2014/september/wha...

[3] https://www.investopedia.com/ask/answers/042015/how-does-mon...

Re: MasterCard to open up network to cryptocurrencies

#300

Post by sz4kerto »

cma wrote: post #285
vbezhenar wrote: post #255

Earlier quoted context omitted.

Your view must be skewed by privilege of having stable currency. Currency of my country lost 250% of its value over last 7 years. It's not bitcoin-level volatile, but close to it. Thankfully I have an option to use USD to hoard money, but that option is not something that's given, in many countries you just can't exchange for fair price. I agree that for someone living in US or EU there's no much point using BTC.

How did it lose more than 100% of its value?

I'm living in an EU-member country. Our currency has lost half of its value compared to the USD since 2008.

How? 'Slowly and steadily.'

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