Mastercard Hates Bitcoins

The new boss in charge of giving out a MasterCard licenses has no intention of allowing the brand or any bank that does private label cards to use Bitcoins. In fact, he nearly bragged to me about killing the BitInstant deal with a U.S. bank for the first planned $BTC card this year.

Stephen Ruch, the MasterCard executive, is just a year into his job with the company, and while he monitors the Bitcoin space he told me he is still under the impression it’s one big Ponzi scheme. Even after meeting with this person socially multiple times, where I explained the mechanics of how digital currencies actually work, he still had a blind eye to its legitimacy. His biggest fear was it would ‘hurt the MasterCard’ brand.

RT’s most popular TV journalist, Max Keiser, weighed in on MasterCard’s fearful attitude telling me, “We can say without equivocation that firms like MasterCard, Visa and the TBTF banks like JPMorgan and Goldman hate the idea of ever having to compete for business again. They have grown comfortable in their corrupt world of writing laws for themselves without any regulatory oversight. They enjoy the exorbitant privilege of bilking the American economy with extortionary transaction rates. They are scared of Bitcoin. And they should be. It offers transparency, cost efficiency and anonymity.”

Now Ruch isn’t blind to helping MasterCard make every penny it possibly can but it appears it’s going to take the likes of someone like Jon Matonis to have a little sitdown to open this man’s mind. On October 18th Ruch sent me a link to a story on ‘Why Bitcoin will fail’ that his staff pulls together for him to monitor the Bitcoin space. I thanked him for the link and responded I was a little behind on $BTC news. Ruch then said responded he thought a lot of people involved in the Bitcoin business were not on the up and up.

I thought WOW he is really afraid of this thing. Whenever I hear anyone think the digital currency is a Ponzi scheme it makes me realize they are just not educated on the subject or they are close minded to the viability of a currency outside the paper money sphere. Now Ruch is an intelligent person but this is also a man who told me he thinks Fox News in the morning is a credible source of information.

Peter Vessenes of CoinLab has often drilled into me that $BTC has to get accessible to scale, to get in the hands of mass main street, and draw the interest of institutional money. But if we’ve got a major road block, at one of the two most powerful institutions who could open the floodgates for Bitcoin accessibility with a debit-like BTC card, then the digital currency space could have problem.

Well at least there is always Visa right?

Editor’s Note: I met Ruch socially and not in an official interview but he knew he was speaking with a journalist who has written about Bitcoins. This is just one of those factual events I felt was important to publish and didn’t think getting MasterCard’s permission to go on the record was needed. The Stamford, Conn. resident, Ruch, official title is SVP/Global Head of Growth Innovation & Planning- Franchise Development


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  1. Nothing wrong with Capitalism…just a shame it’s not done with a conscience, but not a surprise.

  2. MasterCard’s options are to join up with Bitcoin, use it as a transmission mechanism, and make as much off of it as possible, before they become obsolete… or just sit back and become obsolete. I guess they are going with option 2 for now.

  3. Ruch kind of looks like a fat Dr. Evil. Small minded corp exec type likely with no vision.

  4. The myopia, bluster, denial and arrogance are not unexpected, but still amazing to behold. If this guy pulled his head out of his ass for say, 20 seconds, he might realize that there’s still a huge place for the CREDIT part of CREDIT CARD with bitcoin. People are still going to want to buy things without necessarily having the cash (or bitcoin) on hand at that moment. A more imaginative and open-minded executive might actually envision ways to grow his business by embracing bitcoin and leveraging its unique properties instead of going into full on fingers-in-the-ears-lalalalala-I’m-not-listening mode.

  5. Taras Kuzin says

    Teri, in defense of Stephen Ruch, why would MasterCard want to be involved with Bitcoin? Fundamentally, Bitcoin network competes with that of MasterCard. Bitcoin offers a tremendous saving opportunity to merchants. With any transaction costing 5 cents (or potentially being free), Bitcoin network could potentially be a formidable competitor to payment networks with much higher interchange fees.

    Second, I am still puzzled about how MasterCard Bitcoin stored value card creates value to consumers/merchants? I’d love to learn more 😉 Can you elaborate on that?

    • My buddy’s financial advisor went ballistic when he heard my buddy was going to buy some bitcoins. He objected to the fact there was nothing standing behind it and that it would destroy his industry.

      • lol.

        If there’s nothing standing behind it, why would it destroy his industry?

      • Bitcoin is a transaction protocol and record-keeping system. It doesn’t need anything “backing” it, any more than a bank’s computer system needs backing for keeping track of customer account balances.

        The actual value in the Bitcoin ecosystem is the real goods and services people are willing to trade with each other. A bitcoin balance has value because you can expect to trade it for something else later.

  6. We don’t need any established businesses to embrace Bitcoin, in exactly the same way that the World Wide Web didn’t need any help at all from old media.

    Bitcoin enables entirely new business paradigms to emerge. Those new businesses will become Bitcoin’s success, and in the end the industry giants which everybody is afraid of now will either adapt or go extinct.

  7. Reminds me of the mindset at Xerox in the late 70s. They had invented and/or perfected a gui operating system, the mouse, and ethernet. But the upper echelon held firm to the fact that they were a paper-based business and failed to capitalize on any of these things that would eventually drive their paper-based business model into the ground.

  8. Long may the financial corporate giants think Bitcoin is a ponzi scheme. The longer they hold off, the more of an opportunity for the creative and productive to get on board before them so if/when they are eventually forced by circumstances to embrace the new technology or go extinct’, the common man with common sense will be the beneficiary from their having been stubborn/blind for so long! Now wouldn’t that be a nice bit of irony 🙂

  9. I think that this actually is kind of funny. First off, just so the people reading this know, I was going to get an eMBA for “Investment Banking”. The fact that this executive doesn’t want to use his brain, and try to think outside of the box to think of ways that he could implement Bitcoin into his current companies’ implementations is just laughable. Honestly, these are the people that are running todays’ businesses in America and then we wonder why we are falling behind the rest of the world. I’m just going to continue laughing, because there is nothing else we really can do that the Bitcoin revolution already isn’t doing for us.

    It just scares these institutions because for once, instead of us being forced to assimilate or have less access to consumer solutions, this time it is the opposite. The banks, credit card companies, etc all have to either assimilate or get left behind for others to create in their place. And create they will. 🙂

  10. Rubin Kincaide says

    The irony of the Fox News analogy is thick. The 3 major networks controlled the news market for decades. Along comes Fox, and the entire industry is forced to react to their success. How do they do it? By attacking the newcomer. The better and more powerful analogy would have been he still gets his news from NBC. That would’ve demonstrated his closed-minded approach, inability to embrace change, and living in a world of self-promoting deceit.

    We’re lucky Stephen is an exec there. Look at all the wonderful opportunities his narrow thinking is providing us!

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