Credit Card Companies Race Toward Crypto Tech to Boost Profits

Mastercard is looking to fast track blockchain, the technology behind cryptocurrencies such as Bitcoin.

The patents are important because they provide a clue as to how the credit card industry is working furiously behind the scenes to get ahead of the curve on blockchain.

Using the technology may or may not usher in the broad use of cryptocurrency over, say, U.S. dollars.

But it does have the potential to greatly lower the cost of doing business for the finance industry. And that means more profits for the credit card issuers.

A Mastercard patent application disclosed by the U.S. Patent and Trademark Office outlines the means by which a computer node can connect with and authenticate elements of a particular blockchain.

As per Mastercard’s spokesperson, the concept is to increase the speed at which nodes, which store a copy of that network’s contract history, get updated.

Mastercard first made the patent application in October 2016.

And as the application details, “a blockchain may store thousands, millions, or even billions of transaction records over time in a vast number of different blocks.”

Sounds good, but the numbers are, in fact, the problem.

When new blockchain node activation happens, it is mandatory that the next step is to individually verify a massive amount of data in order to activate.

The patent expresses that new nodes must validate “thousands, millions, or even billions of transaction records […] in a vast number of different blocks” that may have amassed over time in a specific blockchain.

The patent thus stipulates a technical solution for more rapid navigation in which “fast track flags” would be included in block headers so that new nodes may scan and validate the blockchain at a quicker speed.

The patent application states “a node in the blockchain network […] may quickly navigate the blockchain by identifying blocks that have activated fast track flags.”

“For verification, the node may identify the earlier fast track block (e.g., based on timestamp) and hash that block […] and then verify that the fast track reference in the more recent fast track block is the same as the hash of the earlier fast track block.”

The patent also presents a framework of the use of software specifically configured to perform querying, hashing, and signatory operations. This would most boost system efficiency.

Blockchain future

MasterCard Labs has reportedly filed for more than 30 “patents related to blockchain tech and cryptocurrency.”

On April 12, USPTO published a MasterCard patent application for tamper proof distributed storage of identity data on a blockchain system that would prevent abuses, such as identity fraud.

In Oct. 2017, the company launched a blockchain system offering business-to-business payments, and submitted a blockchain tech patent for instant payments a month later, in Nov. 2017.

The filing also discusses using a specially configured blockchain. This which would act as the software counterpart to the nodes and help enable further efficiencies.

Investing 101: Do Bonds Belong in Your Portfolio?

Portfolio diversification is a strategy that helps investors manage risk. Investors often choose to diversify among industries for stocks, for instance. But they also consider diversification within different assets types.

Should You Use Extra Cash to Invest or Pay Off Debt?

Deciding between repaying debt repaying versus investing may seem impossible. Everyone’s financial situation is different and only you know from an emotional standpoint what might work best. Start with your

6 Healthy Morning Rituals That Make the Most of Your Day

Whether you are a “morning person” or not, how much thought do you give to the start of your day? Do you realize that by adopting a few simple morning

How to Read and Understand an Options Quote

When you begin trading options you'll spend part of your research scanning for the right options to buy. When you find a list of options, then you'll need to learn

Test Your Financial Advisor’s Loyalty with These Simple Questions

You have a financial advisor in order to make certain you have budgeted your money correctly, have planned for future financial needs, and, in some cases, to turn some of

Sell Puts the Smart Way: Get Out Before Expiration Nears

Selling put options can be a great way to help increase the value of your portfolio without taking on too much risk. At its core, a put sale allows investors


4 Pros and 1 Con of Refinancing Your Home

Two years ago the 30-year fixed mortgage rate was 4.6%. Today it is 2.9%. If your mortgage is in the high threes, you should consider refinancing. Refinancing would lower your

Easy Finance Tip: How to Calculate Your Net Worth

To calculate your net worth, just subtract your liabilities (what you owe) from your assets (what you own). While the equation is simple, it's important to get a snapshot of

Just a Few Bad Market Years Can Slam Your Retirement: How to Cut Your Risk

I believe one very underappreciated risk for investors preparing for retirement is the concept of “sequence of returns.” Sequence of return risk is the danger that the timing of withdrawals

Tai Chi Can Benefits for Those with Chronic Diseases

The Chinese martial art of tai chi can be beneficial to people suffering with chronic illnesses, according to research in the British Journal of Sports Medicine (2015), conducted by Dr.

Two Measures of Options Volatility That Matter

Most people often have a notion of what volatility means. They understand, at least conceptually, that it has to do with data of situations that vary over time. Weather is

3 Financial Habits to Adopt Before You Retire

Nobody wants to work until the day they die. We all want to get to a point where we can simply sit down, relax, and enjoy life.  Consider adopting these