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Mastercard Enters The Crypto World

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Nov 29, 2022
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4 min read
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This blog post will cover:

  • Mastercard’s experience in the field
  • What has changed?
  • Limitations to the offer
  • Collaboration of Binance and Mastercard

One of the major credit card networks plans to facilitate the work with crypto for millions of their clients. According to Mastercard’s announcement, the company will support certain cryptocurrencies directly through its network.

To do so, they partnered with the firm called Bakkt, which will be providing the services linked to crypto.

Mastercard’s experience in the field

Previously, the company has already dealt with this technology but on a much smaller scale: the customers could make transactions using cryptocurrencies. What’s more, Mastercard works with some Central Banks and helps them test digital currencies (analogs to the nations’ fiat money) on their platform.

What has changed?

According to the payments giant’s new policy, their clients should have a choice when it comes to crypto, so if they are willing to use the technology in their business, they should be able to. 

The innovations will introduce new services into the network, including the ability for merchants and banks to offer loyalty programs rewards paid in Bitcoin instead of points or miles and to provide wallets for digital currencies. Customers will be able to spend their digital assets more traditionally without converting to fiat money, as well as "save, store and send money in new ways."

Limitations to the offer

With decentralization and anonymity inherent in the world of crypto, the initiative could well have the potential to turn traditional banking into Wild West, which is why Mastercard is determined to keep it strictly under control. 

They have a set of requirements for reliability and security measures for each of the stablecoins they are planning to work with, including:

  • Privacy and security is the most important aspect. The company wants the information of its customers to be protected.
  • All activity must be legal. Not only do the cryptocurrencies have to follow compliance protocols to ensure the absence of criminal usage of the payment network, but also none of the partners can break the laws of the states where the cryptocurrency in question is used.
  • The digital assets should be suitable for spending, not strictly investment.

Collaboration of Binance and Mastercard

The next step in Mastercard’s crypto policy became their partnership in launching a pre-paid debit card together with Binance, one of the largest online exchanges for trading cryptocurrencies. The cards will be available in Argentina. The idea behind the project is to facilitate entering the world of crypto for people by letting them use cryptocurrencies for purchases just like they would fiat money without fees and complicated onboarding. What is more, rewards for purchases will be available in cryptocurrency.

Mastercard’s efforts in bringing crypto to the mainstream are opening up a lot of perspectives for both businesses and customers, so it is definitely worth keeping eye on the developments.

SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.

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