Venture capital giant Sequoia Capital has suggested that the rise of blockchain technology could put a damper on earnings at major credit card networks such as MasterCard.
The comments came as part of Sequoia’s annual report on the performance of the Sequoia Fund , the firm’s consolidated portfolio offering. The fund currently holds stock in 10 publicly traded companies as part of its portfolio, with MasterCard accounting for 4.3% of its assets.
In the report, Sequoia praised MasterCard for its strong performance since its 2006 IPO, but indicated that it believes new technologies, including blockchain, will begin to affect the company’s value.
“MasterCard’s virtues are well-appreciated by the stock market but the evolution of mobile payment habits and the rise of blockchain ledger technology could pose longer term challenges to the company’s wildly profitable business model.”
In addition to MasterCard, other Sequoia Capital portfolio holdings include Berkshire Hathaway, O’Reilly Automotive and Alphabet, parent firm of Google.
One of the most prolific VC firms, Sequoia Capital invested in 48 startups in 2015 in an attempt to find its next big success story.
Sequoia has previously invested in Apple, PayPal, Stripe, WhatsApp and Yahoo, with 53 of its portfolio firms reaching the initial public offering (IPO) stage since 1972.
Sequoia Capital image via Facebook