Over the years, Mastercard has teetered between being blockchain friendly and despising the entire industry. The payment giant has secured a number of blockchain related patents, including one designed to speed up crypto transactions. Meanwhile, Mastercard’s CEO – Ajaypal Banga – has been trash talking crypto, even going as far as to call it “junk.” It’s a rather perplexing stance for a man whose company is actively making forays into the crypto world.
Despite Ajaypal Banga’s hatred for crypto, Mastercard has won yet another blockchain related patent. This new patent will allow it to cost-effectively create new blockchain partitions so that transactions using multiple different blockchain technologies – such as Bitcoin, Ethereum and Stellar – can all be recorded in the same system.
Currently, information stored in a block on a blockchain needs to be of the same type, for example you can’t record Ethereum and Bitcoin transactions in the same block as they use very different technology. This then means that companies looking to process payments – such as Mastercard – need to create multiple blockchains to record all the transactions it handles. However, with its new partitioned block patent, it can create what it calls a “subnet,” which is essentially multiple side chains that all interact with the main central chain. The central chain would then house all key information – such as account details – then the side chains – or Subnet as Mastercard calls it – would record all the transactions taking place.
Similar Concept to Super Chain
If you follow our blog, you will notice that this sounds rather similar to a blockchain system proposed by Baidu in a new white paper for its new Super Chain – or Xuper Chain. It will work in a very similar way, in the sense that there is one central chain that controls and oversees everything, then its product suite is hosted on various side chains. The side chains all interact with one another through the central chain in an almost identical manner to that proposed by Mastercard. This new blockchain structure concept is more efficient and will allow both companies to perform tasks faster than ever before, while saving vast amounts of money at the same time.
Amex Keeping Up
American Express (Amex) is one of Mastercard’s biggest competitors, and it’s having no trouble creating blockchain projects of its own. Recently, Amex won a patent for a new Proof-of-Payment (PoP) blockchain system, whereby if someone buys an item or rents accommodation, it can then be unlocked or accessed using the same credit card. This new PoP system will revolutionize the way people travel with their Amex card.
Blockchain technology is enabling industries to move forward faster than ever before. It’s providing new competitors where firms previously operated virtually unchallenged. Mastercard, Visa, and Amex all need to fully embrace blockchain technology and cryptocurrencies if they want to survive into the next generation of payment service providers.