MasterCard: Crypto Card Bans Played a Role in 2018 Q1 Drop
Report Given by MasterCard CEO
The major bank’s moves which were to ban the customers from the use of their credit and debit cards in the purchase of cryptocurrencies led to a drop in the cross-border transaction volume in 2018 first quarter. This is according to the report given on Wednesday by the chief financial officer of MasterCard.
Martina Hund-Mejean declared that the organization’s cross-border payments in volume rallied by almost 19% in the first quarter of 2018. However, this was down with only 2$ when it was compared to the last quarter in 2017. Party, this was due to the drop in the crypto wallet funding. This is according to Seeking Alpha which is an earnings call transcript.
“So the issue in this, first of all, in terms of the stacks, on the cross-border volume growth, the cryptocurrency funding or the crypto wallet funding really was 1 percent. It was 1 percent that we saw in the fourth quarter and it was 1 percent that we saw in the first quarter. What the issue is that a number of the banks have decided, in particular in the United States, that they would not allow the usage of cards for this particular funding vehicle. And that’s why we have already seen a relatively significant decrease of the volume related to that event.”
In the previous few months, Bank of Montreal, Bank of America, JPMorgan Chase, Capital One and Citi in Canada and also the US were some of the first banks to ban crypto related purchases because of the current credit risk which has its major results in the vitality of prices.
Additionally, the various restrictions and also uncertainty in the exchanges have promoted the volume decline. This is according to Ajay Banga who is the CEO.
The fall in the interest has also contributed. Therefore, he said; “right now there’s a little less interest than there was in the latter part of the fourth quarter and the first quarter.”
That said, MasterCard thus does not have the interest to count cryptocurrencies as a section of their earnings projections.
“We actually said that 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.”