Bitcoin (BTC) has been growing all over the world and it has been adopted by many individuals that want to make cross-border transactions and payments. There are also speculative investors that are just investing in the asset for the long term. Could then Bitcoin become an alternative to Visa, PayPal, and Mastercard?
Bitcoin As An Alternative To Traditional Financial Payments
According to data provided by BlockData, Bitcoin has the potential to become a medium of exchange in the future. BlockData’s team takes into account different measures related to Visa and Mastercard and compared them to Bitcoin, XRP and other digital assets in the market. According to the information they showed, merchants would see their margins grow almost 4% if they would accept digital currencies instead of the traditional debit and credit cards.
This shows that when a merchant receives $1,000 paid with Visa, he would have in his bank account $944.2. The company has a $25.10 interchange fee. At the same time, PayPal takes $29.3 and $1.4 as an assessment fee.
Visa, Mastercard and PayPal won't exist in 10 years from now.
Why? Because they are way too expensive and blockchain currencies have outpaced them by a mile.
— Crypto Michaël (@CryptoMichNL) April 17, 2019
According to Crypto Michael, a recognized trader from the Amsterdam Stock Exchange mentioned that Visa, Mastercard, and PayPal would not exist in 10 years from now because they are too expensive and virtual currencies outpaced them. He added that digital currencies will be taking out the middlemen.
Meanwhile, other users believe that PayPal will be gone but Visa and Mastercard will not. This could happen because the cost is for insurance and consumer protection. The rest is profit, in which they will need to cut margins to compete.
As per the data provided by BlockData, fees are drastically reduced. A $1,000 transaction would get the merchant $974.22 deposited in the bank account. Although this could not have a major impact in small shops, the cost savings would be larger in the whole retail sector.
Virtual currencies can be embraced by companies and help them reduce their cost even further. Nonetheless, this will require time and effort from companies working in the space.