Payments Giant Mastercard Won Patent for Speeding up Crypto Payment
July 18, 2018 1:58 pm
On Tuesday, Mastercard won a patent for a method of speeding up digital currency payment.
The document published on July 17 by U.S. Patent and Trademark Office (USPTO), describes that through cryptocurrencies have “seen increased usage over traditional fiat currencies by customers who value anonymity and security,” the wide variation in payment processing times between the two classes of assets puts digital currencies at a “disadvantage.”
The patent claims:
“There is a need to improve on the storage and processing of transactions that use blockchain currencies.”
It goes on to describes:
“It usually takes a significant amount of time, around ten minutes, for a blockchain-based transaction to be processed. Conversely, traditional fiat payment transactions that are processed utilizing payment networks often have processing times that are measured in nanoseconds. Hence, many entities, particularly merchants, retailers, service providers, and other purveyors of goods and services, may be wary of allowing blockchain currency for products and participating in blockchain transactions.”
To reduce these transaction times, the company would be offering a new type of user accounts to transact in digital currencies through existing systems for fiat currencies. This account would connect a series of profiles capable of identifying a user’s “fiat currency amount, a blockchain currency amount, an account identifier and an address.”
The transaction themselves would utilize the fiat currency’s payment rails and security features, but each transaction would represent cryptocurrency.
Mastercard further includes that by processing transaction made with digital currencies in this way:
“Payment networks may be able to assess the likelihood of cheating and evaluate risk for blockchain transactions utilizing existing fraud and risk algorithms and information that is accessible to payment networks, such as historical fiat and blockchain transaction data, credit bureau data, demographic information, etc., that is unavailable for use in blockchain networks.”
Indeed, this isn’t the first time Mastercard has shown interest in addressing consumer protection in the space of crypto, having applied for a separate patent last year looking at building refund services for digital currency transactions.