With the booming cryptocurrency sector, experts and consumers alike anticipate the potential of blockchain technology as a substitute for credit cards, says Scott Cook from CryptoNewsZ. Cook looks back on the changes in the lifestyle and ease of payment brought by credit cards back when it was only starting to be common. According to him, payments and other transactions could be much more convenient and efficient with help from blockchain.
A safer alternative
One of the most important reasons that the technology offers a much safer option. Cook states that paying using credit cards requires storing credit information on centralized servers. When accessed by hackers, credentials stored in them will be compromised. However, cryptocurrencies seem to address this issue as it does not require giving out details to merchants. Instead, consumers will be providing ‘private keys’ to indicate ‘approved exchanges.’
According to Cook, these private keys are associated with the transaction, which means that vendors’ servers will not be storing sensitive information. This gives consumers the sole authorized user of their keys while maintaining the power to make exchanges.
Blockchain could ‘steal’ business from Visa
Back in 2017, Vitalik Buterin, founder of cryptocurrency Etherium, asserted that this tech will soon ‘steal’ customers from financial service providers such as Visa, says Business Insider. In fact, he believed that by 2019, it can even replace these institutions, especially with its potential to reduce fraud risks.
Crypto.com CEO Kris Marszalek share the same vision as Buterin. Reports by Forbes say that Marszalek believes that related fees and charges, combined with poor customer experience will drive consumers to the blockchain.
Meanwhile, Cook says that blockchain payment systems are being implemented to some extent by 69% of banks and financial institutions. These establishments are also currently working with fintech teams to develop and implement their own technologies.