Tag: network

Visa Doubles Down on Its Plans for Crypto

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The crypto market has certainly come a long way since the first digital currency was launched and it is now more mature than ever before. Lots of things have changed and perhaps the most exciting development is the widespread interest that major financial and payment institutions have shown.

Global financial and payment service provide Visa is one of the most notable companies that are making a huge play for the crypto market. Already the company has ties with some popular crypto platforms such as Fold, BlockFi, and Crypto.com. However, according to Visa CEO Alfred Kelly, there is so much more in the pipeline.

Crypto Could Be Coming to Visa’s Payment Network

Last Thursday during the company’s Q1 earnings call, the chairman ad CEO reaffirmed Visa’s commitment to crypto which is likely to culminate in digital currencies directly on the Visa network. Kelly firmly believes that the company is well-positioned to add “differentiated value to the ecosystem.” This will essentially involve making crypto safe, useful, and more applicable for global payments.

“..it goes without saying, to the extent a specific digital currency becomes a recognized means of exchange, there’s no reason why we cannot add it to our network, which already supports over 160 currencies today.”

Visa chairman and CEO Alfred Kelly

The strategy is firmly anchored on working with wallets and exchanges to allow users to purchase crypto using their Visa credentials. Similarly, it will also mean that users can cash out their crypto onto Visa credentials.

The Favorites

Well, even though Visa has previously claimed that it does not want to play favorites when it comes to the digital currencies that it will allow on its network, the recent announcement seems to be pointing at something quite different. The company seems to be handling the cryptocurrencies differently based on which category they fall on.

The two categories that the company is using to group blockchain assets are based on whether they are a store of value or are stable coins. Visa intends to angle crypto assets that serve as a store-of-value such as Bitcoin to serve as fiat on-ramp.

However, when it comes to stable coins, the company has been rather bullish. These sentiments may be quite disappointing since they seem to overlook all of the amazing milestones that Decentralized Finance (DeFi) made in 2020. Even JP Morgan Chase which has been showing interest in digital assets has shared the same sentiments.

Number of Daily Bitcoin Transactions Drops Significantly

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The month of March has been tough for several industries across the globe and one of the areas that have been affected is the cryptocurrency market. A price drop that occurred earlier within the month was quite significant. Fortunately, the market has been slowly recovering from that drop and it should be back on track sometime this month.

Despite the impressive recovery of the crypto market, there have been some rather unusual reports regarding the decline in Bitcoin network activity. Daily Bitcoin transactions have been on a steady decline leading experts in the field to look into the matter.

As it turns out, there are several changes that have been noted concerning how Bitcoin, which is arguably the most popular and most widely used digital currency, is being used. While it may seem like a temporary anomaly that will blow over after a while, the plunge in network activity may be a reflection of a greater long-term trend. So, what is going on?

How It Started

Well, since the year rolled around, daily transaction activity grew at a pretty impressive pace and this was partly attributed to the increase in the price of Bitcoin. Both trading and mining picked up pace adding to the number of daily transactions.

However, an abrupt turn in the global economy earlier last month as the coronavirus pandemic spread across more countries affected the crypto market. Crypto prices fell and transactions began to dwindle. Daily transactions fell from over 350k to less than 275k and the number Is expected to fall even further going forward.

Bitcoin Holders Are Hodling

People who own or hold Bitcoin have since pulled thousands of their currency from exchanges and are now trading way less than they used to. Many of them are now only interested in keeping their crypto safe in personal wallets.

The decline in trading and network activity is not the only proof of this fact. There has been a recent uptick in the number of Bitcoin wallets and address diversity. As it stands, there are over a hundred thousand additional addresses compared to what was the case at the beginning of March.

A Win for Bitcoin?

While the decline in network activity is definitely something that people need to be concerned about, it might actually be a win for the crypto industry especially Bitcoin, in this case. The fact that people are keeping or holding their currencies is proof that the digital currency has matured enough to be considered as a health and safe store of value.

The global pandemic is wreaking havoc on the world’s economy and this makes Bitcoin a safe haven for lots of people. Its value is also now bound to go up as there will be very little supply.