Discover CEO Explains Why Credit Cardholders Can’t Buy Bitcoin

On cryptocurrency exchanges and brokerages, traders are not permitted to use their Discover credit and debit cards to purchase or sell bitcoin or any other cryptocurrency in the market.

False Statements
In an interview with Bloomberg, Discover CEO David Nelms stated that for financial institutions to process payments for cryptocurrency traders and investors, they are required by the government to implement strict Anti-Money Laundering (AML) systems and closely monitor the transactions of the traders.

For a company like Discover, that would lead to many millions of dollars in additional compliance costs to address cryptocurrency investors.

Nelms also criticized investors in bitcoin, calling them “crooks that are trying to get money out of China or wherever.”

Evidently, the generalization of institutional investors, retail traders, and individual investors including Fidelity, Tim Draper, Winklevoss Twins, Barry Silbert, Mark Cuban, and tens of millions of people in the US, Japan, and South Korea as money laundering “crooks” can be considered as a baseless condemnation of investors within the global cryptocurrency market.

Currently, the global cryptocurrency market has a daily trading volume of $24 billion, which is larger than some of the world’s largest stock markets combined. Bitcoin alone processes $8 billion on a daily basis and has more liquidity than the most liquid stock on earth, Apple.

Nelms added that the only use case of bitcoin he personally sees is money laundering and financial crime, stating, “or if someone steals our credit card numbers they’re going to ask for payments in Bitcoin. Those are the only use cases I’m actually seeing today.”

On a factual level, the argument of Nelms that the primary usage of bitcoin as a money laundering tool for Chinese investors is highly incorrect because the Chinese government imposed a strict ban on cryptocurrency trading in September 2017. As of now, the Chinese market is nearly zero trading volume, and the largest cryptocurrency markets are the US, Japan, and South Korea.

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