With start-up companies looking to bring the use of cryptocurrencies into the real world, new obstacles have surfaced looking to put an end to their developing ideas. TenX, the start-up company based in Singapore has released a debit card that allows consumers to convert their cryptocurrency into normal currency such as dollars, yen or any other type.
Visa was the first to announce that they will discontinue any support for cryptocurrency debit cards that fall outside of the EEA (European Economic Area). Soon after this announcement MasterCard joined in and declared the same. Thanks to the world’s two most popular card issuers declaring that they no longer support cryptocurrency debit cards outside of the EEA, it’s certain that start-up companies will face troubled times.
With the majority of start-ups that used Visa and MasterCard to issue their cryptocurrency debit cards, the question is who will they use now? Wave Crest Holdings, another renowned card issuer has taken over this position. Wave Crest Holdings being now the number one card issuer in the cryptocurrency community, start-up companies look to them for assistance.
Even with Wave Crest Holdings taking the third party position, a number of companies still face the struggle. Advcash is one of the companies affected by this statement from Visa and MasterCard, as they were forced to notify their clientele that they will no longer issue cards to users outside of the EEA. This announcement from Visa and MasterCard came without any warning, so a lot of start-ups might face bankruptcy as there was no time for preparation.
For users within the European Economic Area, everything will remain unchanged. This might be some good news, however, no one seems to be able to relax as Visa and MasterCard can make new announcements at any moment that can affect the cryptocurrency trade.
For users outside of the EEA, their cards are still in use for a period of 90 days. After the 90 days their debit cards will automatically expire. All funds left on the card will be lost. MasterCard advices the users to spend or withdraw their funds as soon as possible.
CryptoPay and Xapo are another two companies that are being affected by this change but some people believe that there is a positive side to everything. With Visa and MasterCard’s decision, all users outside of the EEA are forced to use local cryptocurrency wallets, resulting in the financial growth shifting from cryptocurrency debit card start-ups to cryptocurrency wallet providers. “A shift in power” is what some call it.
This movement from Visa and MasterCard is clearly made with the wrong intention as even normal online and offline businesses will be impacted. With customers not being able to convert their cryptocurrency into normal currency, trade will decline because only a hand full of businesses accepts cryptocurrency as a form of payment.
With so many sectors being negatively impacted by Visa and MasterCard’s decisions, experts believe that they will also feel the pain when they start losing respect from the cryptocurrency community, a community that’s heading towards financial takeover.