Mastercard’s report shows volume slumps due to cryptocurrency ban.
A quarterly report by Mastercard showed the volume of transactions was slightly lower than expected due to a decline in the number of customers purchasing Bitcoin, Ethereum, and other cryptocurrencies, CNBC reported.
Mastercard reported that the volume of transactions was down 2% “This is due to the recent drop-off in crypto wallet funding,” Mastercard chief financial officer Martina Hund-Mejean said on the earnings call Wednesday Seeking Alpha.
Earlier this year Bank of America, JPMorgan Chase and Citigroup prohibited such purchases, citing credit risks and cryptocurrencies volatility as the reasons for the ban. Many saw this as a move to try to stifle the growth of this burgeoning industry which potentially poses a threat to the traditional banking systems.
Decline due to crypto wallet funding
Martina Hund-Mejean, CFO of Mastercard, stated that one reason for the decline was “the recent drop-off in crypto wallet funding.”
Ajay Banga, CEO of Mastercard, stated that uncertainty in Asia may also have caused some exchanges to pull back in Korea and Japan.
“There’s a lot of concerns even in Japan because one of their biggest exchanges got hacked. As you can see, right now there’s a little less interest than there was in the latter part of the fourth quarter and the first quarter,” said Banga.
He went on to state that cryptocurrencies are not currently part of their corporate plans, citing the unpredictability of cryptocurrencies future.
“This is not something we count on because we just don’t know how to predict it or we don’t even want to count it,” said Banga.
In October of 2017, Banga publically stated he was opposed to cryptocurrency because it was not backed by a government. “If the government creates digital currency, we will find a way to be in the game. We will provide rails for moving currency from customer to merchant. The government mandated digital currencies are interesting. Non-government mandated currency is junk,” he stated to Cointelegraph.