The incipient crypto movement is causing a clash between traditional established investment businesses and their new crypto equivalent peers. Today, the VISA chief financial officer threw some harsh words to bitcoin and all cryptocurrencies alike, in an interview with the Financial Times.
Vasant Prabhu, Visa’s CFO did not hold down when he declared some of its concerns with cryptocurrencies, and the crypto investment market overall. He said that:
It’s very hard to get dirty money through a banking system. Cryptocurrency is phenomenal for all that stuff; Every crook and every dirty politician in the world, I bet, is in cryptocurrency.”
due to the anonymous trait of cryptocurrency transactions. He declared that the bubble is in full force when people who don’t know anything about cryptos, tell others how to invest. Criticizing cryptos as currency without any financial backup, he stated:
With a currency issued by the Federal Reserve, I know who stands behind it; With cryptocurrencies, Who’s good for the money? Who the hell knows?”
Visa is the world’s second-largest card payment organization (debit and credit cards combined), after being surpassed by China UnionPay in 2015, based on the annual value of card payments transacted and the number of issued cards. But, like with all payment processors, its business model is directly threatened by the rise in the adoption of cryptocurrencies. However, Visa has not blocked customers from buying cryptocurrencies using its services; but some banks that use Visa’s credit services had. The company enforces only KYC (know your customer) and anti-laundering policies.
To close the interview, he affirmed that cryptocurrencies are viewed more as an investment instrument, and less as a currency. And a very fluctuating and volatile one, affected by sentiment and susceptible to manipulation. The latest market movements seem to confirm that. Google’s ad ban has sent the market into a downward spiral, and no one knows when it will recover.