The US regulator’s growing distrust of technology companies does not prevent them from extending their services to the cryptomint industry.
As the titans of technology in the United States capture a greater share of their industries and beyond, regulators and governments have become increasingly concerned with their broad power and influence.
In fact, Facebook, Twitter and Google’s parent company, Alphabet, appeared before a congressional antitrust hearing in July.
The government’s main concern is that these companies will use their authority to stifle competition and manipulate users to maintain their market leadership position.
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The latest in a series of ongoing antitrust charges and investigations into corporate giants is the one being considered by the U.S. Department of Justice against Visa. The Justice Department said in a public statement that it was investigating the giant payment acquisition by financial services company Plaid.
The statement accuses Bain & Company, Visa’s consulting and management partner, of failing to comply with the department’s Civilian Investigation Request and withholding important documents about the acquisition. The information requested from the company is considered necessary for the department to analyse the fairness of the transaction and its impact on existing competition. The Department of Justice apparently fears that Visa may have gone against the antitrust laws in order to keep its competition under control.
Visa’s incursion into fintech triggers a Department Bitcoin Evolution of Justice antitrust investigation
Despite the fiasco, the giant of the payments seems to be extending its territory not only in the traditional financial landscape, but also in the crypto payments. Visa cards processed transactions worth almost $2.2 trillion in the fourth quarter of 2020, leaving behind the second largest payment processor, MasterCard, by a margin of more than $1.25 trillion. Even in the crypto space, the company has gained a strong foothold and is powering some of the most famous crypto cards.
In addition to Visa’s already extensive reach in the kryptonie space, Coinbase, the San Francisco-based kryptonie exchange, announced plans to implement a kryptonie debit card with Visa technology in the United States. The card has been available in the UK and EU since 2019. Early next year, Coinbase will also begin issuing its cards to people in all US states except Hawaii.
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According to Coinbase, the card will support stable coins and other cryptom currencies supported on its platform. Users will be able to make payments or withdraw money using their crypto debit cards with Visa technology on any portal that supports Visa cards.
Crypto credit and debit cards certainly make crypto payments more convenient. And the integration of crypto currencies into PayPal is another important driver of crypto currency adoption. However, the expansion of these companies further into the financial technology space may become a concern for the US government. While the failure of these companies to comply with antitrust laws has already been a major problem for the government, their slow but successful growth in the decentralised financial world may be seen as an even greater problem.
The regulatory scrutiny of Facebook’s crypto currency project, Libra, is an appropriate example of how cautious the government is against centralized, private crypto currency projects that have the potential to reach a broad user base.