Visa, Mastercard, and AMEX Stop Bitcoin Purchases??? Risks to Bitcoin, Litecoin, and Ethereum on Coinbase

No doubt we are going to have some shocks to the upward trajectory of cryptocoins such as Bitcoin (BTC), Litecoin (LTC), and Ethereum / Ether (ETC). Is it possible that one of the biggest could be if the major credit card processors suddenly stop allowing companies and Coinbase to allow individuals to funnel money into their accounts?

If you think about it, trading in cryptocoins already circumvents what the credit card companies want you to do which is to take a cash advance. That is what they do to extract even more money from you by offering you a loan with a high interest rate. Right now that cash advance isn't a cash advance when you purchase digital currency on the internet, but it sure feels like it to me. Will the big three, Visa, Mastercard, and AMEX make a ruling on this???

No doubt they are thinking about it internally and weighing the pros and cons. They can't be mad by taking a piece of the action with each credit card transaction, right? After all, Coinbase pays a large percentage of that CC fee directly to those companies. However, Coinbase profits from the bubble, and while the CC companies do as well, they also take on tremendous risk as it effectively allows cryptojunkies a way to trade Bitcoin, Litecoin, and Ethereum on margin. That is ok as long as the trend is our friend and goes in the right direction, but what happens when it is not. In that case Visa, Mastercard, and AMEX could be left with thousands if not millions of delinquent accounts they may not be able to collect on.

This all provides an extra conundrum to users of Coinbase as Coinbase has greatly simplified and reduced risk to investors and traders who look to use a polished and safe platform to trade. As a result, all 3 tradeable cryptocurrencies on Coinbase (LTC, BTC, and ETh) trade at premium to their non-Coinbase peers.