- Chamath Palihapitiya said blockchain platform solana will be part of a swarm of activity that disrupts the global payments business.
- Visa and Mastercard are doing “the single dumbest thing” by raising credit-card fees, he said Saturday.
- The billionaire said last year that both payments companies would be the biggest business failures in 2022.
Chamath Palihapitiya believes blockchain platform solana will play a role in shaking up global transactions that are mostly dominated by giant payments companies.
In a weekend episode of the “All-In Podcast,” the billionaire investor spoke about activity in the payments sector in the last three months. He pointed to Visa and Mastercard this month planning to raise the fees that many large merchants pay when accepting shoppers’ credit cards.
“Visa and Mastercard, I think, are doing the single dumbest thing they could do by being a duopoly, which is raising prices, especially into an inflationary moment, which just lacks complete knowledge and sensitivity of the moment,” he said.
He said the decision to hike prices by these long-standing payment systems creates an incentive for disruption.
“This week, I was able to see a little bit under the hood of Solana Pay, and that’s really exciting,” he said. “So it’s all coming, I think. It’s like a swarm of activity to dismantle these payments businesses.”
The solana blockchain, officially launched in 2019, is seen as an ethereum challenger. One of its most beneficial features is that it can process a huge amount of transactions at low fees. Thanks to its “proof-of-stake” protocol, it’s believed to be more environment-friendly compared to other blockchain technologies.
With a market value of $34 billion, solana’s native token sol is the seventh-largest cryptocurrency, according to data from CoinMarketCap.
Bank of America said in January that solana could take market share away from ethereum because of its low transaction fees, ease of use, and scalability relative to other cryptocurrencies.
Solana’s design allows for “the processing of an industry-leading ~65,000 transactions per second with average transaction fees of $0.00025, while remaining relatively decentralized and secure,” analyst Alkesh Shah wrote in a note.
Palihapitiya has previously spoken out against Visa and Mastercard, calling them a “completely contrived duopoly that doesn’t need to exist.”
He said in December that they would be the biggest business failures in 2022, predicting that they would lose out to emerging blockchain projects.
This week, he also pointed to digital payments app Zelle as another more substantive system than both companies.
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