Though Kenneth I. Chenault, the chief executive of American Express isn’t quite ready to give in to digital money, he says that he saw promise in Bitcoin’s underlying technology. According to him, the protocol of Bitcoin is going to be important and alternative currencies are like the music service Napster, and later iTunes, with their potential to drive industry change.
However, he also admitted that he does not know how this is going to evolve. He thinks that there’s room for a lot of players. At the same time, he also cleared that the reality is that banks are competing with any form of payments and everyone focuses on the displacement of Bitcoin and the credit card industry.
Nevertheless, Ken Chenault is of the view that there is a reason credit cards were invented; one of them according to him was that people wanted the ability to defer payments. As the Bitcoin industry is taking aim at the relatively high transaction fees that credit card companies charge merchants; this has troubled some services providers to great extent.
The supporters of Bitcoin argue that Bitcoin would allow these businesses to save money, which they could then pass on to their customers. However, vested interests in credit cards claim that though they charge fees more than Bitcoin processing would cost, they provide far more protection against fraud than Bitcoin offers.
Bitcoin has Edge over Traditional Payment Methods in Terms of Processing Cost
The cost-efficiency of Bitcoin has become a major point that a lot of payment processing services providers including some banking organization feel threatened about the digital currency. A lot of skepticism is still present in the traditional banking bodies that Bitcoin may take away their business and profits.
Out of fear, not many of such banking organizations are willing to embrace Bitcoin and similar digital currencies. However, from the view of Ken Chenault it looks American Express is not paranoid about the digital currencies. He is someone who has always been open to the innovation and Bitcoin is definitely one of the most effective payment methods to ignore.
When a lot of Bitcoin supporters hope that the virtual currency will one day transform the payments system by enabling the nearly instantaneous transfer of value across the globe, big banks like American Express cannot ignore it. The digital currency is fast receiving acceptance among non-profit organizations who feel it is the best payment method for donations.
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