Bitcoin as Foil: Mastercard’s Outage Another Painful Reminder
Global payment processor Mastercard’s servers went down this week, causing panic among users and echoing Visa’s downing incident earlier in June 2018. Will it be incidents like these that shift more people into “decentralizing” via blockchain tech, away from the centralized status quo?
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Mastercard Leaves Users High and Dry
Technology has created a culture of convenience, but when it does not work as billed, the consequences on daily lives are painful — even if acute. In that vein, Mastercard’s mid-July outage left people around the world stranded, with some unable to pay for medicines and groceries while others were stranded and couldn’t pay their fares home.
As the outage first materialized, Mastercard tweeted:
We are aware there may have been some issues in processing a limited number of transactions earlier. The situation has been resolved and those transactions are now working as normal.
— Mastercard News (@MastercardNews) July 12, 2018
The temporary blackout created an explosion of chatter on social media. In the cryptosphere of Twitter, many unsurprisingly brought up the Bitcoin network as a foil.
To that end, Twitter user ChuckRoc tweeted:
This is why you will soon be replaced by #Bitcoin and the like.
— ChuckRoc (@CharlieHipHop) July 13, 2018
The outage did not only affect individuals, but also major financial institutions that rely on Mastercard as a payment processor. As U.K.-based digital banking alternative Revolut tweeted:
There is a problem with the MasterCard network which is causing some card payments to fail. This issue is affecting a large number of international banks. We'll update you as soon as we know more.
— Revolut (@RevolutApp) July 12, 2018
In response, a furious user Grace O’ Brien tweeted out that she had no access to her money — the opposite dynamic than the one that underlies the “Be your own bank” zeitgeist in the cyrpto community:
2nd time this has happened in a week or two? No access to my own money, again. Pretty disgraceful.
— Grace O' Brien (@gracesfaceplace) July 12, 2018
Mastercard and Visa Fail, While Bitcoin Boasts 99.99% Uptime
Just weeks before, Mastercard rival Visa suffered “hardware failure” leaving millions of people similarly in the lurch. Such incidents aren’t frequent and therefore can result in chaos when they occur. Comparatively, though, Bitcoin’s decentralized network boosts 99.99% uptime.
Not bad for an upstart outsider, right.
The recent Mastercard and Visa outages do highlight the often overlooked fragility of existing payments systems. These payment processors work in centralized structures, hence, a single issue can affect millions of people.
In comparison, decentralized cryptocurrencies — especially the top ones — work under adversarial conditions and can bear numerous issues simultaneously, e.g. spam attacks. For example, if a node on the Bitcoin blockchain fails, then the traffic is diverted to other nodes. The peer-to-peer model makes it so that the entire network failing is almost impossible.
That’s a stark contrast from what we’ve seen out of Visa and Mastercard this summer, to say the least.
Recently, Ethereum co-founder Anthony Di Iorio even said that banks could be replaced by blockchain-powered digital wallets. Likewise, he asserted payment processors will be replaced by blockchain technology. It remains to be seen whether he is right or wrong, of course, as we’re still waiting for the long run. But episodes like what we’ve seen out of Mastercard this week seem to lend further credence to Di Iorio’s expansive prediction.
Does the Mastercard outage hail continued adoption of blockchain tech? Share your views in the comments section.
Images via Pixabay