Global credit card giant Visa said on Wednesday that in the first six months of this year, consumers around the world spent more than $1 billion in cryptocurrencies on goods and services through crypto-related cards.
In contrast, Visa estimates that crypto spending in the same period last year and 2019 is only a small part of that amount. However, the payment giant did not release the exact figures.
Visa Chief Financial Officer Vasant Prabhu told CNBC:
“We are doing a lot of work to create an ecosystem that makes cryptocurrency more usable and more like any other currency. People are exploring how to use cryptocurrency for things they can do with normal currencies.”
“There are many problems in the volatility of cryptocurrencies. But it depends on the owner of the cryptocurrency to manage and track it.”
According to recent research by Visa’s competitor, MasterCard, 93% of North American consumers plan to use cryptocurrency or other emerging payment technologies such as biometrics, contactless or QR code systems in the next year. The study also shows that 75% of millennials will use cryptocurrency if they understand cryptocurrency better.
“We see a lot of people on our [network] buying cryptocurrencies on these various regulated exchanges, and as far as we know, this trend is still going on,” Prabhu said.
This summer, MasterCard will launch a bank card with Gemini, a cryptocurrency exchange co-founded by billionaires Cameron and Tyler Winklevos. The card will allow consumers to earn cryptocurrency as a reward. However, cardholders are not allowed to access their digital wallets on the website.
Visa also announced on Wednesday that the FTX cryptocurrency platform created by billionaire Sam Bankman-Fried (SBF) will be added to its fintech fast track program, partly focusing on making cryptocurrency more practical for consumer and business spending.
Crypto companies such as Circle, BlockFi, and Coinbase (listed on Nasdaq in April) are current Visa partners, allowing cardholders to use their cryptocurrency wallets in more than 70 million merchants around the world to make purchases. Visa estimates that cryptocurrency-related cards and other emerging payments, including biometrics and QR codes, have the potential to disrupt the global annual cash and check payments of US$18 trillion.
Due to the enthusiasm of retail investors as a store of value and an inflation hedging tool during the coronavirus pandemic, the market value of Bitcoin surpassed US$1 trillion for the first time in February and reached a record high of nearly US$65,000 in April. However, since then, Bitcoin has fallen by about 45%-last month, it briefly fell below the $29,000 at the beginning of the year.
Prahbu stated that Visa has no immediate plans to add any cryptocurrency to its balance sheet as Tesla, MicroStrategy and other companies have done recently.
“We don’t have cryptocurrency on our balance sheet today. We hold the currency needed to operate our business on the balance sheet. The currency we hold is the currency we get paid or paid to people. This is often U.S. dollars, euros, GBP. So we have no plans to hold cryptocurrency, because this is usually not the way we get paid or the way we pay our employees.”
In addition, Visa is scheduled to announce its quarterly earnings on July 27.
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