Have Decentralized Payment Systems Finally Managed to Compete With Visa and Mastercard?

It is no secret to anyone even vaguely familiar with the IT sector and the ever-evolving blockchain industry that the latter rose to prominence and capitalization on a slew of promises. Various blockchain projects of every degree strove to offer their own applications for the technology in every industry imaginable. From logistics and tracking the movements of pets on walks to medical services and voting – every aspect of human civilization was being “blockchainized” – for the greater good of mankind.

However, the biggest domain of the promises was the financial realm, where blockchain had the greatest advantages in terms of throughput, relatively low fees, and transaction speeds. The competitors in the ring were the mainstays of the financial transactions market – Visa and Mastercard. Neither side would relent their position in the fight for becoming the next-gen infrastructure for global financial operations. And the fight is now entering its next round. So it is time to place the bets again.

How it started

The fight for the title of the financial heavyweight was announced back in 2017, when during a speech at TechCrunch Disrupt, an Ethereum co-founder said that in two years, nothing would be able to stop blockchain technologies from breaking straight into the financial business and routing out payment systems such as Visa and Mastercard. He had also noted during the speech that despite the hype surrounding blockchain, most modern applications using the technology had not yet been developed well enough to be applied on a massive scale. However, he was hopeful that in a couple of years, or even earlier, blockchain technologies, such as the vaunted Ethereum, would become developed enough to be able to compete on even grounds and even oust traditional solutions worldwide.

In 2018, Pavel Durov came out with the Telegram Open Network project and criticized the Ethereum blockchain and Bitcoin for their inability, in his opinion, to adequately compete with Visa and Mastercard.

“Existing blockchain networks – Bitcoin and Ether – play an important role in the ecosystem, but they are unable to replace Visa or Mastercard. In their current configuration, they are limited to a maximum of 7 transactions per second for Bitcoin and 15 transactions per second for Ether, which is fraught with low processing speed and high transaction costs. By combining minimum transaction times with maximum security, TON can become an alternative to Visa and Mastercard for a new decentralized economy.”

Durov then openly declared that the now ill-fated TON project would undoubtedly shove the giants off their cozy pedestals of dominance. However, recent news has laid those brave claims to rest in a lavish crypt in the blockchain cemetery.

Promising, but doing naught

Despite thunderous claims and great promises, neither Ethereum, nor TON, nor any other blockchain project was ever………….

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Author: Christopher Owen
Original link: https://dailyhodl.com/2020/07/02/have-decentralized-payment-systems-finally-managed-to-compete-with-visa-and-mastercard/