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    Home » Crypto News » Bitcoin Won’t Attract The Unbanked, Says Mastercard CEO

    Bitcoin Won’t Attract The Unbanked, Says Mastercard CEO

    Author: Zhelyazko Zhelyazkov

    Last Updated Oct 30, 2020 @ 09:18

    The CEO of MasterCard, Ajay Banga, has said that Bitcoin won’t help bank the unbanked. He pointed out BTC’s volatility as one of the main obstacles.

    Cryptocurrencies, in general, will not help for the inclusion of unbanked individuals into payment systems and banks, claims Mastercard CEO Ajay Banga. However, the company is far from ignoring digital currencies altogether.

    Trying To Get 1 Billion Into The Banking System

    As per a recent news report, Mastercard CEO Ajay Banga, who’s on a mission to bank upwards of 1 billion unbanked people across the world, doesn’t see much of a use in digital currencies for that.

    Banga’s opinion is that assets like Bitcoin will not make such a significant pull towards financial inclusion.

    According to the CEO, high volatility serves as a downfall for cryptocurrencies. He has highlighted that the value of the most popular one of them (Bitcoin) fluctuates by large amounts, emphasizing that just this year, one BTC changed its dollar value from less than $5,000 in March to almost $14,000 recently.

    “Bitcoin per se is volatile in its valuation,” Banga said, adding, “Can you imagine someone who is financially excluded trading in a way to get included through a currency that could cost the equivalent of two Coca-Cola bottles today and 21 tomorrow? That’s not a way to get them included. That’s a way to make them scared of the financial system.”

    Five years ago, Mastercard’s CEO embarked on a mission to help 500 million people worldwide get access to the financial system and bank services. This year the plan has upgraded up to one billion. According to Banga, people without bank accounts suffer the lack of access to credit while paying much higher fees for financial transactions via payday lenders, etc.

    ADVERTISEMENT

    However, Trust In Crypto Remains

    What MasterCard’s CEO failed to outline, however, is the censorship-resistant nature of decentralized cryptocurrencies, as well as the non-existing barriers to entry. 

    In other words, anyone with access to the internet can become a part of the network without having to go through lengthy and, in many cases, impossible registration procedures to open a simple bank account, for example.

    Moreover, once they become a part of it, there’s no central authority that can ‘shut you down’ per se, regardless of your economic situation or current location.

    There’s merit to his words, nonetheless, because some of the inherent challenges remain. For instance, people need a relatively high understanding of technology and a working computer and internet connection to become part of Bitcoin’s network – something that a lot of citizens in third-world countries simply don’t have.

    Despite the CEO’s opinion, MasterCard has been on the road to adopting digital currencies for a while now. As CryptoPotato reported recently, the company partnered with UK-based payment processor Wirex to expand its cryptocurrency program and aid “adoption and create innovative experiences in the crypto space.”

    Featured image courtesy of CNBC

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    About The Author

    Zhelyazko Zhelyazkov
    More posts by this author

    Zhelyazko is a freelance writer whose interest in cryptocurrencies sparked in early 2017. Being a seasoned content creator with more than ten years of experience in the financial sector, he's into the informational flow 24/7. He holds a degree in English Philology. Contact Zhelyazko: LinkedIn

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