Visa and NFT craze
Only few hours ago, we informed that Visa has bought its first NFT for almost 150 000 dollars. This step of one of the payment conglomerates was only announced in the morning via official Twitter account of the company. Visa has specified that it bought NFT CryptoPunks #7610, which is one of the 3 840 female punks in the 10 000 collection set of Larva Labs made in 2017. The company has paid 49.5 ETH for this NFT.
According to Cuy Sheffield, head of the crypto Visa division, this step should be seen on many different levels. First and foremost, this purchase was done in order to expand the collection of Visa, which can be viewed as an evolution of the financial system. It already has such pieces, machines or artefacts like paper credit cards or zip-zap machines. Sheffield believes that this NFT is a great piece to have in collection like this.
“We felt that CryptoPunks would be a great addition to our collection of artefacts that can chart and celebrate the past, present, and future of commerce.”
More importantly, Visa decided to do this step to try by itself, what the process of buying an NFT looks like. This is because Visa believes that NFTs are the future and therefore, this company wants to be able to help customers and companies on their journey in the NFT world. To be able to do so, Visa must have its own experience with NFTs, which it now has. This is, however, a bit questionable, since Visa has not bought the NFT itself. Visa has used one of its partners, Anchorage Digital, to do so. The company only handed fiat to Anchorage Digital, which not only bought the NFT, but is also now storing it and has it in custody. Thus, it is yet to be seen, what Visa actually learned from this purchase.
PayPal is taking a different route
While Visa has jumped onto the NFT bandwagon, one of its competitors, PayPal, has chosen a different strategy. And that is to expand its cryptocurrency services to more countries. Until now, only PayPal users from United States could have bought cryptocurrencies directly on the platform. That changed today, since PayPal has announced that it is now offering the option to buy cryptocurrencies also to its UK users. They will therefore have the opportunity to buy Bitcoin, Litecoin, Ethereum or Bitcoin Cash directly in the app or on the website for as little as 1 dollar.
PayPal estimates that it has over 2 million monthly users in the United Kingdom, which is a reason why PayPal is “tackling” the adoption of cryptocurrency services in the Europe through one of its strongest countries. However, while lot has changed for PayPal and its users in the past year, one crucial change has not been done yet. And that is the change of actually buying and owning cryptocurrencies.
Since you can not withdraw cryptocurrency from the platform, you do not actually own cryptocurrencies, only their derivatives. That means that since you are not the owner of the private keys to any given cryptocurrencies, you are only holding a speculative investment asset, not a cryptocurrency. While this might be sufficient for traders who are speculating on the volatility of the underlying assets, long term investors or hodlers should not buy or hodl through this platform since they can not withdraw they cryptocurrencies to cold wallets.