Travis Hoium

If the goal is like, hey, this is better than Visa and MasterCard because there's none of those pesky fees and the fees are less, here comes the creep.

Again, the house is going to win here.

Visa can cut their fees in half a lot easier than these companies will find it to just raise them.

Well, it would be Visa and the banks, though.

I think that's going to be the sticky part is that Visa takes a relatively small chunk of that 2.9% or so.

But again, Travis, this is margin.

And it's always the path of least resistance is the incumbents lose a little margin versus a new system comes into place.

That has happened over and over again.

This isn't just about, quote unquote, protecting Visa or protecting the banks.

Right now, the system that we all benefit from works because, in part, the banks have so much access to cheap deposits.

To the extent that we threaten that for the sake of lower credit card fees, we are potentially causing a bank crisis down the road that will do more harm than the toll that they are extracting on the economy.

You can say that this is fear-mongering.

You can say that it'll never happen.

You can say, oh, that's the worst case.

The job of regulators is to avoid worst case.

It is to keep the system stable and functioning because, again, the system basically works.

So this may not be fair.

It may not be consumer-first friendly.

It might mean that businesses still have to figure out what to do with credit card fees.

All of that can be true, and it can still be the right decision in terms of financial stability and long-term financial stability.