Mastercard and Visa To Classify Crypto Purchases As "High Risk"

Cryptocurrencies ICOs and exchanges have been attacked high and low from every side possible in these last days. Starting with Nouriel Roubini declaring to the US Congress that he thought that cryptocurrencies are the mother of all scams and Sen. Elizabeth Warren saying that cryptocurrencies were “easy to steal”, this week on crypto has not been so good. But these attacks were verbal in nature, and cannot cripple exchanges or cryptocurrency startups operations. But a bigger threat that involves Mastercard and Visa has been averted for the exchange market.
Credit behemoths are starting to charge against crypto enterprises once again by declaring these institutions as “high risk”. This effectively means that chargebacks from clients that make transactions with these kinds of startups can be made even after 540 days after the day of the transaction, amongst other considerations. All exchanges, cryptocurrency firms, and binary options operators must present a license for the payments to be released. In case that a license does not apply for the country or region of operation, the interested party must present a document from a legal local firm to support the claim of the legality of the business. But all the payments from clients made to these types of businesses will be blocked until they get whitelisted by Mastercard and Visa.
This marks a great hit for exchanges registered in unregulated countries that rely primarily on credit card payments to fund customers activities and will stale their sales until a proper solution can be found. Also, there is no clear indication of what they mean with “reputable” law firms to make the necessary reports, something that is very subjective.
According to Finance Magnates, this move was planned since early April, when they reported that starting October 12, Mastercard would take this measure, also predicting (accurately) that Visa would also be taking these measures, a thing that they will be doing in this next December.
This is already affecting exchanges that get services from third party payment processors, who are getting suspending their services to then. So exchanges will have to rely on another type of payments to let clients pay for their operations, like bank wires. The problem is that they are expensive and slow.
This is not the only time that Mastercard and Visa have acted against the cryptocurrency sphere by reclassifying exchanges and other crypto startup exchanges as “cash advances”, taking 5% more on the rate of every cryptocurrency purchase made with this cards.

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