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 in selling that cryptocurrency, which would drive the price down. That’s not what cryptocurrency investors actually want.

Should also note that MasterCard crypto transactions almost certainly won’t be settled on the blockchain. Not with $8 Bitcoin transaction fees. They’ll just be denominated in cryptocurrency and people can deposit/withdraw in certain cryptocurrencies. MasterCard only needs to buy and sell on the blockchain as needed to provide an FX window. The actual transactions would be stored in traditional database systems (aside from customer deposits/withdrawals, just like Coinbase)

Why? Because MasterCard would get to act as an exchange and collect exchange fees. Exchange fees are a great way to charge consumers for spending their own money in 2021, when normal credit cards actually pay people 1-2% to use them. Cryptocurrency’s inefficiency is their financial upside.

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 offers this in the United States. And do the Americans take this offer? Yes! They buy over a billion dollars worth of Bitcoin per month on Paypal. If this continues, it means that every American from toddler to senior buys $50 worth of Bitcoin per year.

Other companies in the finance industry will want the same free lunch. Run on crypto in 3..2..1..

This will continue until the first companies will start to offer you to transfer your crypto out. Then slowly the market will normalize. Now everyone has crypto. In their paypal/mastercard/bank/whatever account and/or in their own wallet.

Looks like chances for broader crypto adoption are pretty good.

It's important for people to read the actual press release: https://mstr.cd/3tLaPZM There's good info here which will be new info to many.

Why did they do this? It turns out that about a third of Nigerians report using or holding cryptocurrency (!). https://www.statista.com/chart/18345/crypto-currency-adoptio... Second place are Vietnam and the Phillipines. For all, the #1 reason was for remittances.

Haven't we all had it drilled into our heads by CNBC and the likes that crypto was nothing but a big speculative bubble? Woops, I guess that was a big lie.

> Users will also benefit from Wirex’s Cryptoback™ rewards program, which automatically gives customers up to 1.5% back in Bitcoin for every purchase made in-store.

It does appear that they will support transfers to external wallets (!), contrary to what has been claimed elsewhere in this thread -> https://wirexapp.com/help/article/how-do-i-transfer-cryptocu...

The card is not yet available to US customers, although, apparently it is in the works -> https://news.bitcoin.com/wirex-launching-us-after-receiving-...

To everyone saying "my credit card pays me 2% to use it", no, your credit card charges the merchant 2.3%+ to use it, that gets bundled into the price, and they give you 2% of that as a kickback.

I don't want mastercard supporting crypto. I want the merchants and payment providers supporting crypto so I do not have to use mastercard and their "rules". If I want to pay for porn or send a donation to wikileaks I do not want mastercard/paypal or anyone else other than the government (if it's legal I should be allowed to pay for it) deciding if that is ok.

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.

Bitcoin = store of value. Network effect is reducing the chance of government intervention, as well as blockchain tail risks.

Getting 1 of the 21 million bitcoins is like decentralized proof of saying "I had 48k worth of value in Feb 2021!"

It locks in the value that you created forever. Otherwise governments will just keep printing money, and your value gets diluted arbitrarily.

Assuming the mechanisms of protection for the blockchain holds, it should work out exactly as that.

People often think crypto == bitcoin. I think there are 4 categories that people should think about: 1. Crypto as asset class (BTC/ ETH) 2. Crypto for transactions - usually pegged to a dollar or other fiat eg. USDC 3. Crypto as a utility/ asset backed token - filecoin etc 4. fraud.

I think mastercard visa etc will focus on #2 above and it will bring extremely powerful dynamic to these ecosystems

There’s always lots of bluster and comments about cryptocurrency with things like this and not always much concrete information.

I think as a tech community here on HN we should try to focus on why these changes are occurring so quickly and what the repercussions are. Let’s talk constructively about the risks and opportunities more than we do about who’s buying, who’s selling, on and on.... is it a bubble.. does it have value, etc etc. Clearly it’s here to stay and clearly large chunks of our economy will soon be dealing with it.

So let’s instead talk about constructive ways to move regulation forward. Expand education and communication etc.

For instance I have a concern that we’ll leave a large percentage of people further behind as digital cryptocurrency becomes a larger part of the economic system.

I thought the whole idea of Bitcoin was to get out of the financial system that Mastercard is a central piece of.

Unclear what this actually means. Can I pay my credit card bill using crypto? That's a taxable event and a pain in the butt to track.

Can I buy stuff from merchants using crypto, and they receive crypto? Useful, but most merchants will want fiat currency, so someone on the chain will have to convert it to dollars, which again would be a taxable event.

Anyone know what the "select" cryptocurrencies are?

The focus on Bitcoin's lack of intrinsic value and energy use is really getting boring.

I read Hacker News comments for more information on a story.

How about some of that for a switch? Go bitch about intrinsic value and ecological disaster on one of the other bitcoin threads please.

The public thinks Bitcoin is the currency of hackers. Decentralized, technical, innovative and challenging the whole financial backbone. In reality... We have threads like this. Never seen so much hate for Bitcoin as on HN.

It's bizarre that in this tread, the US dollar is treated like an immaculate flawless tool for transferring value. But in every thread about economics, its agreed the US dollar lacks trusts, is being manipulated by the fed, and is the leading cause of gross wealth inequality.

This is being wayy overanalyzed.

MasterCard is in the business of payments. Millions of people now have a bunch of idle money sitting in a potential payment vehicle outside of their current network. Anything MasterCard can do to start to siphon off some of that value is good for them. This has nothing to do with ideology, philosophy or technology. And d4mn right it’s a good sign for the Bitcoin bulls.

Anybody kind here whou would explain me how is this different from Binance card https://www.binance.com/en/cards ? Of course Binance card is not available everywhere but excluding this restriction these two are the same system, right ?

The last thing I want is to help the MasterCard and Visa duopoly persist, given how many times these companies have polices others by instituting payment blocks on people like Wikileaks. I view cryptocurrency as an alternative to the current financial system and not something meant to be leveraged by these incumbents.

I'm pretty sure Mastercard did know that there are a lot of CC companies that already use crypto. And they just want to get a share of that pie. And if they do it now, their share can still be enormous. If they just take the same percentage the use now for traditional payments, the will get a lot of exposure to crypto. And they might speculate that the whole sector will grow over the next X years. And just them onboarding, will make it more likely for this to happen.

I use a crypto backed cc since nearly 1 year. It's NOT that you are paying in crypto, you still have to convert the coins to a stable currency and the top up your card with it. There are cards that 'make it look' like you are paying in crypto. But the do the same thing in the background.

What if we could just attach a MasterCard to a bitcoin wallet rather than a bank account and then use it to pay at any ordinary POS terminal so the conversion would be done seamlessly and the store would get ordinary money? Is this what they are going to implement?

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How long will it take before the float on networks like Visa/Mastercard grant them the ability to perform 50% attacks on the blockchain?

Note: I don't really understand how this all works, so if my question is silly, I'd love to learn.

Serious question: what happens when nobody wants their HW assets to verify the blockchain? What happens when the infrastructure falls apart or the demands on the blockchain verification outpaces the number of machines available to verify? Can you buy/sell btc off of the internet? Why would we want a future with digital assets that are inherently relying upon things that can fall apart with an EMP (not trying to be a doomsayer/fearmonger)?

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.

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I wonder where this puts crypto's such as Bitcoin Cash (BCH), whose main benefit is having a faster and cheaper network? Is the final card Bitcoin has to play, the fact that it has the brand awareness to hide its faults behind the MasterCard/Visa network?

So what exactly is MasterCard offering that relates to cryptocurrencies? What I gathered from the article was “it was planning to offer support for some cryptocurrencies on its network this year” But does not seem to go into detail further than that.

Im bullish on Monero becoming a winner in the space. It’s private and transaction fees are pennies.

Mentioned elsewhere in the thread was a larger problem: the amount of time it takes to settle up. I’m very curious how this will be addressed.

Lol, now Indian government will be all hunky dory with such news articles related to crypto in the country.

Checkout what amptoken.org is doing. A Mastercard employee is one of the advisors to the project

What exactly does this mean?

Basically what Visa is doing by facilitating the Coinbase card or something more involved?

I think this is a miss guided application and it's a sign that the cryptocurrency space is struggling to find a use case beyond as a store of value.

Please upvote my very original opinion that hasn't been rehashed on nearly every cryptocurrency thread on hacker news.

What a clever way to tie an identity to a crypto wallet!

So how would they ruin it with KYC/AML this time?

Is this why Musk promoting cyptocurrencies.

the tesla bandwagon is being jumped on by mastercard.

FOMO

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This seems like a bad idea.

Wirex is gonna use this, AFAIK.

⌘ https://wirexapp.com/

(Use https://wirexapp.com/r/kseistrup if you wanna sign up through a referral link.)

Aliens: look at this species they've come up with this weird concept of "money". Some of them have more & can obtain more resources with it. Because they can't trust each other they need a book-keeping system that uses more resources than they needed in the first place! Quite ironic.

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.

I am not sure who in their right mind will buy BTC at $48K a piece! There's nothing major that's has happened, yet, the bubble has inflated from $6K to $47K only because it's now harder to steal electricity in China and the rest of the world to mine bitcoins. Every week in Bulgaria we hear for a new electricity thieves who got caught and have stolen electricity for millions - often in the middle of nowhere like in small villages, farms, etc. Didn't China started to crackdown on miners last summer [0]? And, yes, all marketplaces are manipulated by the same miner cartels. I am not sure how China has allow this so far - especially when many used Bitcoin as a vehicle to export capital. So far, Bitcoin is wasting as much electricity as Argentina, but if this bubble keeps inflated so that the Chinese miners can stay in business, where are we going to end up soon?

[0]: https://news.bitcoin.com/chinese-government-crackdowns-and-c...