Last Week in Review: Jack Dorsey and Jay Z team up to fund BTC development

by Team Luno
· 4 minute read

From BNY Mellon (AKA America’s oldest bank) to Mastercard, the list of companies jumping aboard the crypto train keeps growing. In amongst the mayhem, Jack Dorsey and Jay Z (you never thought you’d see those two names alongside one another) are funding bitcoin development in India and Africa.

It’s all happening. Get the details below.

Mastercard to allow merchants to accept payment in crypto

Another financial giant making moves in the crypto space is Mastercard, who last week announced plans to give merchants the option to receive payment in crypto later this year.

The new functionality will see Mastercard customers’ digital currency payments settled in crypto at participating merchants. In the past, Mastercard supported limited crypto transactions through its cryptocard partners, Wirex and Uphold. However, those programs only covered payment and not settlement, which means the coins were converted into fiat long before reaching the merchant.

The new initiative seeks to allow businesses who opt-in the chance to do business beyond the bounds of the fiat ecosystem, but there remain questions around which currencies will be supported – and bitcoin may not necessarily be included among them.

Mastercard’s Executive VP for Blockchain and Digital Asset Products Raj Dhamodharan hinted that, instead, stablecoins will be the primary beneficiary of Mastercard’s upcoming integration. He explained, “Our philosophy on cryptocurrencies is straightforward: It’s about choice. Mastercard isn’t here to recommend you start using cryptocurrencies. But we are here to enable customers, merchants and businesses to move digital value.”

Suffice it to say, this is another development the community will be keeping their eyes on.

Morgan Stanley contemplates bitcoin investment

Morgan Stanley’s $150 billion Counterpoint Global investment unit is considering placing its own bitcoin bet, according to a report by Bloomberg. It wouldn’t be the company’s first exposure to crypto, though, as it currently has a nearly 11% stake in bitcoin-bountiful MicroStrategy. The investment unit manages nearly 20 units, five of which returned gains over 100% in 2020.

Analysts at Morgan Stanley have said bitcoin has the potential to strongly compete with the dollar but also acknowledged that the more investors hold bitcoin, the less viable it is to be used as a day-to-day currency.

Miami considers adding BTC to its balance sheet

It’s not only companies looking at crypto with googly eyes – the City of Miami is now officially considering shifting some of its reserves into Bitcoin.

On Friday, the city’s governing commission passed a resolution that it will look into the possibility of investing government funds into bitcoin, thanks to its bullish Mayor Francis Suarez. The resolution also suggests analysing the feasibility of allowing government employees to receive some or all of their wages in crypto, and on allowing citizens to pay property taxes or city fees using crypto.

Suarez told the city commission: “I think we’re on the cusp of seeing a major titanic shift on this. It’s an industry that’s boisterous, vociferous and growing, and this would send the right signal.”

There’s a catch, though – Florida has stringent rules around what local governments are allowed to invest in, citing the safety of funds as a primary directive. Since the price of bitcoin can skyrocket in an instant, and also see sudden downswings, huge losses could be experienced.

The outcome of these plans is yet to be seen, but it appears Suarez is a man on a mission looking to transform Miami into a tech innovation hub – even having hired the city’s first chief technology officer, Said Ishoof.

Not to be outdone though, former presidential candidate and longtime bitcoin advocate Andrew Yang who’s currently running for mayor of New York echoed the desire to turn his city into “a hub for bitcoin and other cryptocurrencies.”

The race is on – who will succeed? Let us know what you think on Twitter.

PayPal looks to become CBDC distributor

Last Thursday, PayPal CEO Dan Schulman laid out a vision for its digital wallets to be the means by which central banks distribute CBDCs to customers across income levels.

Speaking at the company’s annual investor day, he said, “You think about how many [digital wallets] we’re going to have in the next two, three or five years, and we’re a perfect complement to central banks and governments to distribute those digitized forms of currency.”

Shulman also revealed the company is looking into smart contracts and the tokenisation of other non-crypto assets, noting: “This is a once in a multi-decade opportunity where the fundamental rails of the system are going to be redefined and we have a chance to help shape that.”

As we reported last week, the company has seen a 12% increase in weekly transactions on the platform since adding crypto. Time will tell whether PayPal sees as much profit by shifting into the CBDC distribution game too.

Jack Dorsey and Jay Z create 500 BTC endowment to fund development

Twitter CEO Jack Dorsey and rapper Jay Z announced their efforts to create an endowment to fund Bitcoin development in Africa and India.

The duo are pouring 500 BTC into the fund, worth ~$23.9 million at the time of writing. According to Dorsey, it will be set up as a blind irrevocable trust that won’t take any direction from its founders once it’s set up. The hunt for three board members has already begun, with Dorsey tweeting a link to an application form on Friday.

Dorsey has long shown his admiration for bitcoin, even asserting it may become the internet’s own native currency. Twitter itself, though, hasn’t invested in BTC so far, and its CFO Ned Segal said early last week that the company had considered whether it should invest some of its assets into bitcoin but felt it wasn’t the right time.

Segal explained, “It’s something we continue to study and look at. We want to be thoughtful about it over time, but we haven’t made any changes yet.”

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