Visa and Mastercard, the undisputed leaders in card payments, are in the spotlight for their attempts to block competition. According to a recent report, these two colossi have spent millions to ensure they maintain their dominant position. But what is really interesting is the impact this could have on the emergence of decentralized alternatives, such as cryptocurrencies, which represent a threat to their economic model.
Visa and Mastercard: Maintain control at all costs
Visa and Mastercard have built colossal empires, controlling a considerable share of card transactions globally.
But as technology advances at a breakneck pace, their dominance is proving more fragile than ever. Cryptos, and more particularly blockchains, offer powerful, more transparent and often less expensive alternatives.
To curb this competition, these two giants have chosen a strategy that could seem archaic: lobbying.
According to recent datatogether they would have invested more than 80 million dollars to influence legislators and reject any reform of the payments sector.
This lobbying focuses on laws that, if passed, would pave the way for increased competition.
However, the posture of Visa and Mastercard is not just a question of economic domination. It also reflects a deep reluctance to accept change.
By targeting these reforms, both companies seek to delay the inevitable: the emergence of a world where financial transactions no longer depend on physical cards or their infrastructure.
Crypto innovation: An existential threat?
At first glance, it might seem like cryptos and credit cards play in different leagues. But cryptos, particularly projects like Bitcoin and Ethereum, aim to redefine how we manage money, and that directly threatens Visa and Mastercard.
Cryptocurrencies are decentralized, transparent, and can significantly reduce the costs of cross-border transactions, where credit cards often charge high fees.
Many perceive the Visa-Mastercard duopoly as a brake on innovation, slowing down the emergence of alternative solutions.
Crypto could offer a more open, less expensive and intermediary-free system. But as long as these financial giants continue to weigh on policy makers, small businesses, consumers, and even crypto projects will struggle to fully break into the world of everyday payments.
And yet, the growing interest in cryptos shows that consumers are ready for change.
The success of digital currencies and decentralized platforms demonstrates that demand exists, but supply is constantly stifled by anti-competitive practices.
This increasingly visible phenomenon is fueling criticism of Visa and Mastercard. These companies, although dominant today, could very well see their power quickly erode if legislation evolved in favor of competition.
Regulation: A lever to break the monopoly
Calls for regulation are becoming more and more pressing. The Credit Card Competition Act of 2023, a bipartisan proposal, aims to introduce changes to the credit card industry to facilitate access for new entrants, including crypto solutions.
The goal is clear: open the market, reduce costs and promote an ecosystem where innovation can thrive. This text could well become a decisive turning point in the fight against the monopoly of the credit card giants.
However, even if the US Senate does not yet seem to have set a date to debate this law, the shadow of cryptos already looms over the discussions.
While banks and traditional financial institutions view the arrival of regulation with caution, crypto players are ready to enter the arena.
The disruptive potential of blockchain could provide consumers with solutions more suited to their needs, and above all less expensive.
In conclusion, the future of payments is played out on two fronts. On the one hand, Visa and Mastercard are trying to protect an empire they spent decades building. On the other hand, the emergence of crypto and decentralized solutions is putting unprecedented pressure on these traditional players. Meanwhile, Meta is breaking records.
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