Virtual Money Roll on a Fiat Rails
CryptoBit News Today1 min read
On a day when Bitcoin and other major cryptocurrencies are rallying in the past 24 hours, Mastercard was awarded a patent for a system that could make blockchain transactions faster and safer, which would allow customers to more easily use crypto in day-to-day transactions.
Mastercard's concept, titled "Method and system for linkage of blockchain-based assets to fiat currency accounts," describes a setup that connects to and oversees two distinct accounts—one holding conventional money and the other holding cryptocurrency. It proposes creating a structure that manages “fractional reserves of blockchain currency” to enhance transaction speed and security, according to Mastercard.
As an illustration, the company pointed to Bitcoin's 10-minute processing delay, driven by verification demands, block constraints, and heavy resource usage, as a hurdle to realizing practical cryptocurrency payments.
However, beyond transaction speed, Mastercard flags the inherent anonymity of blockchain transactions as a fraud risk, with the customer’s identity remaining unknown in retail transactions. To counter this, the patent outlines a process for Mastercard to micro-manage a digital currency account, in conjunction with stamping user profile data including all relevant transaction data with at least one fiat account, a home/business address, and a personal identifier on Mastercard’s blockchain.
