Visa's Chief Financial Officer Vasant Prabhu is no fan of cryptocurrency, arguing in an interview with the Financial Times that digital tokens are for criminals and speculators who have no idea what they are doing.
In the interview, Prabhu said of the bitcoin craze that cryptocurrency was the preferred payment method for every “crook and dirty politician” and speculators who have “no clue.” The executive said that he gets worried about how many ill-informed retail investors get into the cryptocurrency market because they don’t know what they are doing. “The people asking me are the ones who scare the hell out of me,” he said in the Financial Times interview. “You know, guys like the limo driver to the airport . . . They have no idea what they are doing.”
Since the start of 2017, cryptocurrency had been surging as the leading digital token soared from $1,000 to more than $20,000 at one point. The value jumped so much that it caught the attention of Wall Street and the media, thrusting it into the minds of regular investors. That sparked a cryptocurrency craze that ended partly with a steep decline in the value by the end of last year. Bitcoin has been recovering, but the frothiness of investors has been reduced a little bit. Governments have stepped into the market, issuing warnings to investors and clamping down on cryptocurrency exchanges. “This is the ultimate thing that you hear about when you have a bubble, when the guy shining your shoes tells you what stock to buy,” Prabhu told the Financial Times.
While the Visa executive is skeptical about cryptocurrency, the payments company is experimenting with blockchain, which is the technology that underpins bitcoin. It’s currently testing the technology to enable cross-border corporate payments but doesn’t process or settle transactions with cryptocurrency. “With a currency issued by the Federal Reserve, I know who stands behind it,” Prabhu said. With cryptocurrency, “Who’s good for the money? Who the hell knows?” Still, Visa hasn't joined other banks that have banned the purchase of cryptocurrencies with their credit cards. Prabhu thinks cryptocurrency should be viewed as more of a speculative investment, like commodities, instead of a payment option, given the lack of regulation.