MasterCard captured a United States patent for a method of accelerating crypto payments. The patent document, published yesterday by the US Patent and Trademark Office, explains that even though digital currencies are seeing an increase in usage when compared to fiat currencies for people who love security and anonymity, these cryptocurrencies are at a disadvantage because of payment processing speeds. The patent also states a need to ensure better storage and processing of transactions which use blockchain technology.
The document spells out, “It often takes a significant amount of time, around ten minutes, for a blockchain-based transaction to be processed… Conversely, traditional fiat payment transactions that are processed using payment networks often have processing times that are measured in nanoseconds… Therefore, many entities, particularly merchants, retailers, service providers, and other purveyors of goods and services, may be wary of accepting blockchain currency for products and participating in blockchain transactions.”
In order to reduce the transaction time, MasterCard will start offering a new type of account. Soon, people will be able to transact in digital currencies that are pegged in fiat. The new account will have a series of profiles. They will identify the user’s, “fiat currency amount, a blockchain currency amount, an account identifier and an address.”
In this new method, transactions apply fiat payment methods and all security features while transactions will represent digital currencies. MasterCard also notes that “payment networks may be able to evaluate the likelihood of fraud and assess risk for blockchain transactions using existing fraud and risk algorithms and information that is available to payment networks, such as historical fiat and blockchain transaction data, credit bureau data, demographic information, etc., that is unavailable for use in blockchain networks.”
Not Their First Rodeo
This is not the first instance of MasterCard showing interest of address consumer protection issues in the cryptocurrency sector. The company actually applied for another patent last year seeking to build a refund service for crypto transactions. Refunds are one problem affecting the crypto markets since wrong transactions are irreversible. If this problem has a solution, then it would be huge news for the market.
With MasterCard being a well-established company in the financial sector, it has adequate experience to help the crypto markets. That experience will especially help in the approval of crypto transactions. With other financial institutions researching the crypto markets, expectations are the crypto-sphere is likely to grow quickly.
Source: https://www.coindesk.com/mastercard-wins-patent-for-speeding-up-crypto-payments/
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