Mastercard and Visa give hope to cryptocurrencies!
A payment card to spend cryptocurrencies all over the world, and at most merchants.
This is a concept that appeals to Visa and Mastercard issuers. For the past two years, the two companies have been seeking to partner with cryptocurrency exchange platforms that manage several million crypto wallets, to equip them with a payment card.
This week, Mastercard CEO Michael Miebach announced that he is working with Binance to soon provide a compatible payment card to more than 90 million merchants worldwide. For him, cryptocurrencies are an excellent way forward and the blockchain industry will already reach a certain maturity within 5 years maximum. As a result, international registry systems like SWIFT will no longer exist by 2027.
Mastercard has already worked on cryptocurrency payment cards with other platforms and is now tackling Binance. Like the neobanks, Mastercard is at war with Visa. The two issuers regularly alternate positions with the partner companies. Currently, Visa already offers a payment card to Binance. It is not clear whether the current work between Mastercard and Binance will have the effect of moving Visa away from the crypto platform.
Crypto-free payments
In France, Ledger is also working on a payment card for his customers and their physical crypto wallet. The equipment is a bit behind while card issuers must not put the French gem in their priority for the number of customers much lower than platforms like Binance, Coinbase, FTX or Crypto.com.
Importantly, these so-called “crypto” cards do not settle merchants in a digital currency. In fact, Visa and Mastercard develop cards that, on each transaction, convert the amount requested by the merchant into fiat currency. Cryptocurrencies stored on the customer’s crypto wallet are converted into Euro or another currency so that it can be accepted by the merchant.
The big advantage of crypto cards is that the ceilings are much higher than in a traditional bank. On the other hand, the exchange between cryptocurrency and fiat currency is important from a tax point of view. As a reminder, you are taxed on your capital gains in cryptocurrencies only if you convert them into fiat currency. An important point to consider.
Also note that the current Visa Binance card, available to French customers, does not take into account Bitcoin payments. To use the card on a payment terminal, a wallet containing NBBs, BUSD, USDT, BTC, SXP, ETH, EUR, ADA, DOT, XRP, AVAX, SHIB, LAZIO, PORTO or SANTOS must be used.
