Visa buys a CryptoPunk NFT as it tests the digital commerce space
Visa has announced that it has purchased the CryptoPunk 7610 NFT as it marks its first foray into the NFT space in what it sees as a test of this industry and its entry into digital commerce.
For those who have not been exposed to the crypto ecosystem, this might come as a big surprise as it is difficult to understand why Visa, a company dealing mainly with cards, would want to buy an NFT which is basically considered as a digital collectible. But for the crypto head of Visa, Cuy Sheffield, it seems a natural progression as he believes that NFTs would form the future of retail, social media, and eCommerce. But for speculators, it is one more in the list of instruments that they can pump up in the coming months.
Visa completed the purchase of the NFT to understand the infrastructure and other requirements for the purchase and safe storage of NFTs and would be looking for ways to leverage the NFTs and also look into how the company can seamlessly integrate the NFT buying experience for its customers in the future.
Cuy said that the company facilitates commerce and so anything that leads to commercial transactions would be of interest to Visa. With NFTs gaining in traction over the last few months, with sales crossing $1 billion last month, it is clear that the future would bring in a lot more transaction volume in the NFT space and Visa would like to be part of that engagement and ensures smooth and reliable transactions happen in the NFT space as well.
Cuy sounded a note of caution as well as he said that he wasn’t sure whether NFTs go mainstream and it was more of a business decision for the company to see how the whole cycle of NFTs work so that it can be ready for the transactions in this space as it grows. It is indeed a bit surprising that the NFT space has gained so much attention in such a small timeframe but it could also be risky as more companies enter into this space and some of the companies may not have a clear understanding of the industry. Already, there have been reports of companies issuing NFTs without following the required security protocols which could lead to losses for the retail traders who get dragged into this space out of FOMO. There are no regulations and oversight on NFTs from any company as yet and this could be dangerous in the coming months, especially for the retail traders.