Mastercard says bitcoin is ill-suited for payments

Bitcoin does not behave like a payment instrument — it is highly volatile and a transaction takes too long, said Mastercard Executive Chairman Ann Cairns in an interview with MarketWatch.

“If we go out for coffee and I decide to pay with bitcoin, our drink could cost me, for example, 40% more by the time it is served. And the actual completion of the transaction would take 10 minutes,” said Cairns.

As an asset class, bitcoin can be compared to gold, but not as a means of payment.

Mastercard intends to roll out stablecoins in its network and is working with central banks on their plans for digital currencies (CBDCs).

Earlier Mastercard exited the Diem project, the global stablecoin (then Libra), developed with the participation of Facebook.

Volatility has been cited as a barrier to institutional investment in bitcoin by institutions, for example, at JPMorgan, Berkshire Hathaway or Bridgewater Associates.

However, Fundstrat Global Advisors’ head of research Tom Lee recently said that 40-50% corrections are “part of the DNA of the first cryptocurrency.”

#bitcoin prone to corrections of 40%-50%

— part of its DNA and its history
— doesn’t change fair value per @David_Grid network value model#bitcoin target $100,000
— looks on sale, right?$SI $MOGO $MSTR

— Thomas Lee (@fundstrat) February 23, 2021

He pegged bitcoin’s fair price at $100,000, and, in his view, current levels look like a sale.

Mastercard has promised open this year the possibility for merchants to accept cryptocurrency payments.

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