Blockchain interesting but unproven, Mastercard’s Ajaypal Banga

"A lot of this has to improve and change over time," he says

Blockchain technology has yet to live up to the hype, according to Mastercard CEO Ajaypal Banga.

Speaking this week at the FinTech Ideas Festival, he told CNBC that Mastercard had reservations, even though it possesses the third most patents in this space.

“I think blockchain could be interesting, but the business model is not proven,” Banga said. “A lot of this has to improve and change over time.”

Mastercard is, however, “deeply invested” in a few ideas, including the potential to improve supply chains and problems with counterfeit goods. “There are interesting possibilities with blockchain and to ignore that would be a bad idea,” he commented. “We’re just saying we don’t know the business model yet.”


Among the many patents filed by Mastercard is an offering that would make transactions over the blockchain completely anonymous, from the point of origin to the amount being transacted.

The system would work by using an “intermediate” address when a transaction takes place using a public key. While the transaction data is stored, a new transaction and digital signature will be created using a private key. The transaction data containing the destination address and payment amount would then be sent on.

The filing states that: “The method would result in showing the user transferring funds to and receiving funds from only a small number of addresses that are also involved in a significantly large volume of transactions with various other users, thereby rendering the data innocuous.”

The amount will also be hidden by using multiple transfers through multiple addresses. The filing goes on to speak positively of cryptocurrencies and the blockchain ecosystem in general, stating that users are “flocking to various digital currencies,” as they prefer “the anonymity that blockchain transactions can provide.”

Mastercard added: “Specifically, it is often extremely difficult to identify the user behind a blockchain address, meaning that an individual can transfer or receive funds utilising a blockchain while keeping a high level of anonymity.”

However, blockchains can in fact be traceable through forensic analysis, with the application stating that “transactions can be traced due to the nature of the blockchain as an immutable ledger.”

The patent continued: “For instance, such data may, as it is accumulated and analysed, eventually reveal the user behind a wallet or at least provide information about them … However, the existing communications and attribution structure of blockchain technology such as Bitcoin require identification of where the transactions are emanating and terminating, in order to maintain the ledger.

“Thus, there is a need for a technical solution to increase the anonymisation of a wallet and the user associated therewith in a blockchain.”

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