Mastercard Granted BitLicense by NYDFS
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Mastercard Transaction Services has been granted a BitLicense by the New York State Department of Financial Services, NYDFS. The approval reflects Mastercard's ongoing engagement with regulators. "Clear regulatory frameworks play an important role in building trust and confidence as new forms of digital value move from experimentation toward practical application," said Jorn Lambert, Chief Product Officer at Mastercard. "This approval underscores our focus on aligning innovation with regulatory expectations of high levels of security, compliance and risk management."
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Analyst Views on MA
Wall Street analysts forecast MA stock price to rise
28 Analyst Rating
25 Buy
3 Hold
0 Sell
Strong Buy
Current: 493.750
Low
500.00
Averages
660.00
High
739.00
Current: 493.750
Low
500.00
Averages
660.00
High
739.00
About MA
Mastercard Incorporated is a technology company in the global payments industry. The Company connects consumers, financial institutions, merchants, governments, digital partners, businesses and other organizations worldwide by enabling electronic payments and making those payment transactions secure and accessible. It provides a range of payment solutions and services using its brands, including Mastercard, Maestro and Cirrus. It operates a payments network that provides choice and flexibility for consumers, merchants and its customers. Through its proprietary global payments network, it switches (authorizes, clears and settles) payment transactions. Its additional payments capabilities include automated clearing house (ACH) transactions (both batch and real-time account-based payments). It offers security solutions, consumer acquisition and engagement, business and market insights, gateway, processing and open banking, among other services and solutions.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Mastercard Receives BitLicense from NYDFS
- Regulatory Approval: Mastercard announced on Wednesday that it has received a BitLicense from the New York State Department of Financial Services, which establishes consumer protection, cybersecurity, and financial integrity to ensure the safe development of digital assets.
- Strategic Alignment: This approval aligns with Mastercard's long-term strategy to responsibly engage with payment and settlement infrastructures supporting digital currencies like stablecoins and tokenized deposits, further solidifying the standards underpinning its global payments network.
- Market Environment Enhancement: The NYDFS has played a crucial role in providing regulatory clarity, fostering a safe and responsible environment for the development of digital assets, thereby promoting healthy industry growth.
- Future Growth Potential: By obtaining the BitLicense, Mastercard not only enhances its competitiveness in the digital payments space but also lays the groundwork for future innovations and market expansion, further elevating its leadership position in the fintech sector.
See More
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- Project Partnerships: Dubbed Project Lightwell, the initiative has already attracted major U.S. banks such as Goldman Sachs, Morgan Stanley, JPMorgan, and Bank of America as early adopters, indicating strong market confidence and demand for IBM's new platform.
- Innovation Driven by Technology: CEO Arvind Krishna noted that Anthropic's Mythos model was a pivotal factor in driving this investment, highlighting the potential of large language models to discover and exploit vulnerabilities in code, which could reshape the cybersecurity landscape.
- Collaborative Industry Outlook: IBM and Red Hat are dedicating 20,000 software engineers to assist partners in securing software, with Krishna emphasizing that cybersecurity firms should be viewed as partners rather than competitors, a collaborative approach that could enhance overall industry security capabilities.
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- Transaction Volume Surge: Visa's payment transactions rose from 73.8 billion a year ago to 79.8 billion, with total payment volume increasing from over $3.9 trillion to about $4.3 trillion, demonstrating a deepening consumer reliance on credit cards and further solidifying its leadership in the payment processing market.
- Strong Mastercard Performance: Mastercard achieved a 16% revenue growth during the same period, with earnings per share rising from $3.59 to $4.35, and transaction volume increasing by 8.5% to 52.3 billion, reflecting the company's robust performance and future growth potential in the global payments market.
- Shift in Consumer Habits: Surveys indicate that over 50% of U.S. consumers now use credit cards for everyday expenses like groceries and utility bills, illustrating that credit cards have become a primary payment method in modern consumption, which enhances the long-term profitability of Visa and Mastercard.
See More
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- Significant Valuation Gap: Bank of America trades at a P/E ratio of 11.6, compared to Visa and Mastercard's 25.1 and 25.4, respectively, highlighting Berkshire's value judgment on traditional banks, which may attract long-term investors.
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See More
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- Portfolio Restructuring: Following Warren Buffett's departure, Berkshire Hathaway has completely divested its stakes in Visa and Mastercard, indicating a preference for traditional banks, particularly Bank of America, which constitutes 8% of its portfolio.
- Significant Valuation Gap: With Visa and Mastercard's projected P/E ratios at 25.1 and 25.4 respectively, compared to Bank of America's 11.6, Berkshire's choice highlights its strategy of favoring reasonably valued traditional banks over high-valuation fintech companies.
- Long-term Stability: Berkshire's decision to retain Bank of America despite selling high-valuation fintech stocks underscores its recognition of the long-term stability and above-average income (with a current dividend yield of approximately 2.1%) that traditional banks offer.
- Investor Strategy Insights: For long-term investors seeking value, Bank of America presents a solid option, while those interested in fintech expansion should consider Visa or Mastercard, illustrating the diversity of investment goals.
See More
Mastercard Receives BitLicense from NYDFS
- Regulatory Approval: Mastercard announced on Wednesday that it has received a BitLicense from the New York State Department of Financial Services, which establishes consumer protection, cybersecurity, and financial integrity to ensure the safe development of digital assets.
- Strategic Alignment: This approval aligns with Mastercard's long-term strategy to responsibly engage with payment and settlement infrastructures supporting digital currencies like stablecoins and tokenized deposits, further solidifying the standards underpinning its global payments network.
- Market Environment Enhancement: The NYDFS has played a crucial role in providing regulatory clarity, fostering a safe and responsible environment for the development of digital assets, thereby promoting healthy industry growth.
- Future Growth Potential: By obtaining the BitLicense, Mastercard not only enhances its competitiveness in the digital payments space but also lays the groundwork for future innovations and market expansion, further elevating its leadership position in the fintech sector.
See More
IBM Invests $5 Billion in New Cybersecurity Platform
- Significant Investment: IBM has announced a $5 billion investment in a new cybersecurity platform aimed at addressing vulnerabilities in open-source software, which not only underscores the company's commitment to cybersecurity but also enhances its competitive position in the enterprise market.
- Project Partnerships: Dubbed Project Lightwell, the initiative has already attracted major U.S. banks such as Goldman Sachs, Morgan Stanley, JPMorgan, and Bank of America as early adopters, indicating strong market confidence and demand for IBM's new platform.
- Innovation Driven by Technology: CEO Arvind Krishna noted that Anthropic's Mythos model was a pivotal factor in driving this investment, highlighting the potential of large language models to discover and exploit vulnerabilities in code, which could reshape the cybersecurity landscape.
- Collaborative Industry Outlook: IBM and Red Hat are dedicating 20,000 software engineers to assist partners in securing software, with Krishna emphasizing that cybersecurity firms should be viewed as partners rather than competitors, a collaborative approach that could enhance overall industry security capabilities.
See More
Credit Card Giants Surpass Expectations
- Significant Revenue Growth: Visa reported $11.2 billion in revenue for the fiscal second quarter ending December 31, marking a 17% year-over-year increase, with total transactions rising from 73.8 billion to 79.8 billion and total payment volume increasing from $3.9 trillion to $4.3 trillion, indicating sustained consumer demand for credit cards.
- Strong Performance by Mastercard: Mastercard achieved a 16% revenue growth (12% on a constant currency basis) during the same quarter, with earnings per share rising from $3.59 to $4.35, and total transactions increasing by 8.5% to 52.3 billion, facilitating $2.7 trillion in goods and services purchases, reflecting strong market demand for its services.
- Future Growth Expectations: Both companies anticipate double-digit revenue growth in the foreseeable future, albeit likely in the low double digits, with analysts expecting profit growth to continue outpacing sales growth, indicating strong market confidence in the credit card business.
- Shift in Consumer Habits: As credit card usage rises in everyday spending, cash payments have dropped to just 7% by 2024, while credit cards have doubled their share to 17%, demonstrating that credit cards have become the primary payment method for consumers, enhancing Visa and Mastercard's market positions.
See More
Credit Card Usage Continues to Rise, Defying Expectations
- Significant Revenue Growth: Visa reported $11.2 billion in revenue for the fiscal second quarter ending December 31, marking a 17% year-over-year increase, indicating that consumers remain active in using credit cards despite economic uncertainties, thereby enhancing the company's market position.
- Transaction Volume Surge: Visa's payment transactions rose from 73.8 billion a year ago to 79.8 billion, with total payment volume increasing from over $3.9 trillion to about $4.3 trillion, demonstrating a deepening consumer reliance on credit cards and further solidifying its leadership in the payment processing market.
- Strong Mastercard Performance: Mastercard achieved a 16% revenue growth during the same period, with earnings per share rising from $3.59 to $4.35, and transaction volume increasing by 8.5% to 52.3 billion, reflecting the company's robust performance and future growth potential in the global payments market.
- Shift in Consumer Habits: Surveys indicate that over 50% of U.S. consumers now use credit cards for everyday expenses like groceries and utility bills, illustrating that credit cards have become a primary payment method in modern consumption, which enhances the long-term profitability of Visa and Mastercard.
See More
Buffett Era Ends, Attention Turns to Abel's New Strategies
- New CEO Strategy Shift: With Buffett's over sixty-year reign at Berkshire Hathaway ending, the focus is on new CEO Greg Abel's strategies, particularly as the company exited 16 investment positions, indicating a preference for traditional banks.
- Portfolio Restructuring: Berkshire's decision to exit multiple large investments, including Visa and Mastercard, while retaining an 8% stake in Bank of America signals confidence and importance placed on traditional banking.
- Significant Valuation Gap: Bank of America trades at a P/E ratio of 11.6, compared to Visa and Mastercard's 25.1 and 25.4, respectively, highlighting Berkshire's value judgment on traditional banks, which may attract long-term investors.
- Long-term Investment Advice: Despite Berkshire's sale of Visa and Mastercard, its commitment to Bank of America suggests a focus on stable income and reasonable valuations, recommending long-term investors to consider opportunities in Bank of America.
See More
Berkshire Hathaway Adjusts Portfolio Post-Buffett Era
- Portfolio Restructuring: Following Warren Buffett's departure, Berkshire Hathaway has completely divested its stakes in Visa and Mastercard, indicating a preference for traditional banks, particularly Bank of America, which constitutes 8% of its portfolio.
- Significant Valuation Gap: With Visa and Mastercard's projected P/E ratios at 25.1 and 25.4 respectively, compared to Bank of America's 11.6, Berkshire's choice highlights its strategy of favoring reasonably valued traditional banks over high-valuation fintech companies.
- Long-term Stability: Berkshire's decision to retain Bank of America despite selling high-valuation fintech stocks underscores its recognition of the long-term stability and above-average income (with a current dividend yield of approximately 2.1%) that traditional banks offer.
- Investor Strategy Insights: For long-term investors seeking value, Bank of America presents a solid option, while those interested in fintech expansion should consider Visa or Mastercard, illustrating the diversity of investment goals.
See More
