MasterCard gets new Patent for Bitcoin Transactions on Credit Cards
MasterCard won a patent that would protect a method to manage ‘fractional reserves of blockchain currency’. According to Seth Eisen, Mastercard’s senior vice president for communications, currently, MasterCard users can only pay using currency that has been declared as legal tender by the government.
In the document with the U.S. Patent and Trademark Office, MasterCard noted the increased use of blockchain currency by consumers who value security and anonymity. The document also noted the inherent disadvantages of this currency and mentioned that there is a need to improve the storage and processing capabilities of digital currency transactions.
The document noted,
While blockchain currencies can often provide such safety and security for the payer’s information, such security may be limited for payees, particularly due to the limitations of the blockchain.
An example of this is that digital transactions will take about 10 minutes to process vs. traditional transactions only take a few seconds. The document also noted that a lot of merchants, retailers, service providers and others may be hesitant to use blockchain technology and accept blockchain currency.
Despite these issues, if this technology comes to market, it can increase the speed of blockchain transactions by allowing users to pay for things in cryptocurrency merely using their credit cards.
Eisen also wrote the following about this patent in an email to CNBC
We’re consistently looking at ways to bring new thinking and new innovations to market to create value for us and our customers and cardholders. Patent applications are part of that process, taking steps to protect the company’s intellectual property, whether or not the idea ever comes to market.
Fundstrat Global Advisors Tom Lee also said that this patent is a good news for the cryptocurrency industry. He said,
It’s really validating the idea that digital money, or blockchain-based money, is a valid form of transaction.
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