Visa and Mastercard Stocks Plunge: Are Amazon and Walmart to Blame?
Walmart Inc. and Amazon.com Inc. are among the companies that have recently discussed issuing their own stablecoins in the US, according to a Wall Street Journal report citing unnamed sources. This situation is weighing down the industry. Visa and Mastercard saw their largest one-day declines in about two months on Friday, with Visa losing over 7.1% and Mastercard losing as much as 6.2%. Moreover, to get around credit card companies like Visa and Mastercard, major retailers, as well as other international behemoths like airline operators and Expedia Group, Inc. have thought about issuing their own cryptocurrency tokens.
Retailers Trigger $60B Crash in Card Giants
The combined market capitalization of Visa and Mastercard dropped by about $60 billion as a result of this news. Analysts, however, stated that now is a favorable moment to purchase shares at a discount.
We encourage investors to accumulate shares of Visa and Mastercard on weakness,
Andrew Jeffrey of William Blair
Although shops see stablecoins as a viable way to reduce the cost of accepting cards, Jeffrey said they are still not very appropriate for business-to-consumer transactions. He said that a lack of stablecoin standards may further restrict its use, noting that consumers are used to using credit and debit cards and that these habits won’t be changing anytime soon.
Stablecoins Meet Resistance: Why Might Visa and Mastercard’s Plans Be Stalled?
According to Diksha Gera of Bloomberg Intelligence, concerns that stablecoins would reduce volume share and margin are reflected in Friday’s share drops. However, it is still too early to worry about this.
Visa and Mastercard have proactively integrated stablecoin capabilities, while lingering trust and regulatory hurdles, along with a prolonged adoption curve by consumers, might impede widespread adoption,
Gera
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