A ‘Visa Cryptocurrency’ Can Cost $3 Billion

Opponents and critics of the Bitcoin community’s resolution to conduct a growth path that set priorities the coin’s program as a store of value often claim that a payments-first attention is required to create a “base level of demand” for a cryptocurrency.

Nevertheless, in Twitter, BitGo co-founder Ben Davenport makes the case that the payments and fees use makes nearly insignificantly base level of request since the network’s users would only require to keep the token as long as is needed to perform a sought payment.

Davenport was answering to Civic CEO Vinny Lingham, who made the statement  that a “crypto has to have real utility & usage to support the price.”

Davenport reasoned that this hypothesis has a important gap in it.

To demonstrate his point of view, Davenport incorporated what would happen if credit card giant Visa — which processes $9 trillion in payments annually and currently has a market cap of more than $294 billion — substituted its framework with a cryptocurrency that could resolve and transform  operations into regional currency during one hour.

During some calculations ($9 trillion / 365 days / 24 hours * 3 to account for extra volume on peak shopping days), he proven that the base level of request for a payments-focused cryptocurrency — that is, the minimum amount of capital tied up in transactions at any given time — is just $3 billion.