DOJ Probe – Network Tokenization – 2023

It’s hard to believe I’ve been writing about payment tokenization for 11 yrs. Tokenization is an overloaded term with multiple definitions. Last week McKinsey wrote a fantastic article on crypto tokenization, this note is about the tokenization of card numbers (PAN to DPAN) performed by network tokenization services like Visa Tokenization Service (VTS) and Mastercard Digital Enablement Service (MDES). 

This week the US DOJ opened a probe into network tokenization services (Bloomberg). The specifics of the probe are not known

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Last Mile Redesign (Processor-Merchant)

21 Jan 2016

My favorite blog of the year was written by famed UK computer scientist Paul Graham – The Refragmentation. Paul’s blog aligns very well to the work of 2 Nobel prize winners in economics: Oliver Williamson (2009) and his mentor Ronald Coase (1991). Both were focused on the factors governing the “nature of a firm”. (particularly Transaction Cost Economics).  I covered how TCE relates to the sharing economy and the future of collaboration in my August blog Collaboration and the “Sharing Economy”.

If I were to pick the proof point for ‘refragmentation’ and TCE within the payments industry it would be processing. If payments is a network business.. processing is undergoing open access (think MCI/ATT), nodal redesign (think iPhone vs rotary), big data (democratized access), enterprise software (ERP/CRM), and direct sales (amazon) … ALL AT ONCE.

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