Back in 2017, cryptocurrency cards were all the rage. Touted as a solution for the limited cryptocurrency market, they promised a new age of crypto — we just had to wait for it. Well, it’s summer of 2018 now, and we are still waiting. Something has clearly gone wrong.
A crypto card is a banking card that you can load up with cryptocurrencies and later spend them at the nearest shop. Or cash them in at the ATM. The idea is that they will automatically convert your crypto into the fiat money, almost erasing the border between the two.
Bonpay actually had a cryptocurrency card at the end of 2017. They were not the only ones, but their solution was one of the most advanced at that point. However, they, as well as almost every other crypto card service, soon got set back almost to the beginning.
In January 2018, WaveCrest — a mediator between all cryptocurrency services and VISA — had their VISA contract terminated. It was coming for awhile — in fact, they repeatedly breached this contract until VISA could not ignore it anymore. And so thousands of cryptocurrency users received emails that their card service is going dark and they should probably withdraw their money until later news. For most of them, this news never came.
After months of silence, most users threw their cards away or kept them as rather unique coasters. No one really expected the cards to make a comeback — especially since card issuers got much more careful with picking their partners.
However, things are getting better. There are new mediators, new projects and even some of the old ones returned to the public eye. Bonpay, for example, plans to issue the first 20 000 cards this summer.
But it’s been awhile, and in this business you always want to keep your ear to the ground. So Bonpay decided to conduct a survey and asked people what card issuer they would prefer for their crypto cards.
They Bonpay team asked the Bonpay website visitors and Twitter users “What card issuer do you prefer for your crypto card?”. They had four different options — VISA, MasterCard, UnionPay, and Discover.
The results are hardly shocking:
847 users participated in the survey between 2018-05-19 and 2018-05-25
With 847 respondents, 55% would like to have Visa as provider for their crypto cards. MasterCard is a preferable option for 35% of users. UnionPay, same as Discover, got around 5% of votes.
Not all card issuers are equal and, as you can see, our graph reflects that. But to understand why people are going after VISA and MasterCard so hard even after being burned by WaveCrest, let’s look at some stats.
VISA and MasterCard are like Coca-Cola and Pepsi — two giant corporations that are the leaders of the market. VISA currently controls more than 50% of it, while MasterCard is at 31% and gaining. As you can see, our data reflects that with enough accuracy.
Also, VISA and MasterCard cards are accepted everywhere, at practically any ATM or terminal. There are some exceptions when the merchant has a partnership with only one provider, i.e., VISA’s deal with Costco, but they are scarce.
UnionPay is a payment system founded in China under the approval of the People’s Bank of China. It is the largest card payment organization in the world — so large, that 53 out of 100 people in South Asia use UnionPay cards, with more than 5.3 billion cards currently active worldwide.
However, outside of Asia, UnionPay has only 0.5% of the global market. So one might say that their 5% on our survey are rather generous. While UnionPay is accepted in 168 countries, the quality of their coverage is not stellar.
Discover is the main competitor of Visa and MasterCard on the American market with nearly 44 000 000 card holders. Their cards are not as widely accepted — especially outside the USA. This promptly explains why only 5% of users want to have Discover as their card provider.
As you can see, the main reason behind VISA and MasterCard supremacy is convenience. If you are with them, you won’t have to run around the city (or, in some cases, a country) looking for an exact ATM that supports your card. You’ll simply drop by the nearest store and buy whatever you want.
So at the end of the day, convenience wins. And that’s why people need a crypto card — it’s the ultimate convenience. No one will have to search for Bitcoin-friendly stores, enter long Bitcoin wallet addresses and wait until the transaction is confirmed. People will just go to the nearest Starbucks and buy a cup of Americano with Bitcoin card.
Bonpay is finalizing our cards now, with the announcement literally behind the corner. The pre-order is on for those that are ready to use the cryptocurrency in a whole new way — again.
Disclaimer. This article is paid and provided by a third-party source and should not be viewed as an endorsement by CoinIdol. Readers should do their own research before investing funds in any company. CoinIdol shall not be responsible or liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any such content, goods or services mentioned in this article.