To some investors, one of the surest signs of a bubble is when parties involved trade on hearsay and rumor rather than on grounded information. When Jesus Coin hit the market, its creators presented it as an over-the-top joke, a riff on what they saw as the ridiculousness of the cryptocurrency industry and the willingness of investors to place a stake in any product that came along. Sure enough, investors flocked to Jesus Coin. Now, a cryptocurrency called Monaco shows that investors may have bought into a news story suggesting that the digital token was linked with a Visa Inc.-backed payment card, when in fact that deal did not (and does not) exist.
Monaco vs. Visa
On May 17, Monaco's issuing company released a tweet suggesting that it would offer a payment card backed by Visa, Inc. (V). At the time, as it turns out, the company did not have a deal with Visa, according to Bloomberg. Weeks later, the company once again hinted at the possibility of the card, this time releasing a press item discussing the benefits of its partnership. Still, even at the later date, there was no agreement with Visa in place.
Was Monaco deliberately trying to confuse and mislead consumers? It's a bit difficult to say. The company behind the cryptocurrency is, reportedly, working with Wirecard AG, a Visa-licensed issuer, to come up with a partnered card. From Visa's perspective, according to spokesperson Lea Cademenos, Monaco is in the vetting process as of this time.
Monaco Regrets the Decision
According to Monaco's CEO, Kris Marszalek, "in retrospect [the company] probably wouldn't put the Visa name on there yet. It probably would have been more prudent to just leave it out until everything is done." In a more recent press release from August 31 in which the company announced plans for new payment cards, Visa was not included. In that single day, Monaco's currency dropped in value by 29%. Still, at the highest point, the currency had gained nearly 700% in value since the announcement was initially made. As of this writing, its value remains about triple what it was at that time.
Monaco is one of many cryptocurrencies aiming for a partnership with Visa, as a Visa-backed payment card would automatically be accepted by more than 44 million merchants in the Visa network. Still, there are boundaries to a cryptocurrency-credit card partnership: cryptocurrencies tend to capitalize on their anonymity, while credit cards must abide by customer information rules designed to limit money laundering and other illicit activities.
Marszalek has spoken out to ensure investors that Monaco is continuing to work on securing the potential deal with Visa, although there is no official news as of yet.