Vasant Prabhu, CFO of card leader Visa, can’t seem to come to terms with bitcoin.
He didn’t hold back his ire for the decentralized network to the Financial Times, instead pointing to its appeal for “every crook and dirty politician” not to mention clueless speculators. Visa’s Prabhu has been “shocked” by misguided retail investors who know just enough about bitcoin to be dangerous.
“The people asking me are the ones who scare the hell out of me. You know, guys like the limo driver to the airport . . . They have no idea what they are doing,” Prabhu told the FT.
Bitcoin fever is everywhere, and it’s insulting to the top finance executive of a global payments company whose brand is weaved throughout a centralized banking system. He calls them “true believers,” saying he’s a “dinosaur” to bitcoin enthusiasts who live among him in his San Francisco community.
Mr. Prabhu sees all the makings of a bubble, based on the quick profits that even people close to him are generating, with one relative having doubled their funds with cryptocurrency.
“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,” said Mr. Prabhu.
US banks and have moved to ban credit card payments for cryptocurrencies, while Sweden’s Nordea has banned its employees from owning BTC. While Visa payments aren’t processed in bitcoin, the company falls short of prohibiting its customers from transacting with bitcoin. But that doesn’t mean Visa’s Prabhu has to like it.
“With a currency issued by the Federal Reserve, I know who stands behind it. With cryptocurrency, who’s good for the money? Who the hell knows?”
KYC and AML
Visa strongly enforces know-your-customer (KYC) and anti-money laundering protocols, which is yet another reason that bitcoin irritates the company’s finance chief. Cryptocurrencies, he suggests, line the criminal toolbox.
“It’s very hard to get dirty money through a banking system. Cryptocurrency is phenomenal for all that stuff . . . Every crook and every dirty politician in the world, I bet, is in cryptocurrency,” said Prabhu.
Meanwhile, the involvement of bitcoin in fraudulent activity is on the decline amid the traceability factor for digital wallets and a transparent public ledger, as per a report by security firm Bromium cited in Market Watch. But that doesn’t mean scamsters, who get away with $200 billion in fraudulent profits yearly, are turning away from cryptocurrencies altogether. They’re preferring more anonymous coins, such as Monero.