The payment company is currently deciding which crypto assets should be supported based on criteria such as compliance and security
Mastercard announced yesterday that it will support cryptocurrencies directly on its network from the end of this year. The payment giant analyzed aggregated data and found that many of its customers were using their cards to purchase digital assets as well as to use crypto cards.
Mastercard realized that cryptocurrencies are now becoming an increasingly important part of the payment system and would like to give customers, merchants and companies the opportunity to move the digital value as they wish. This innovation could help providers build loyalty to existing customers who want to use crypto, while opening them up to new customers.
The payment company is currently preparing for the change and deciding which digital assets to support. Many cryptocurrencies do not meet Mastercard’s requirements because they have to tighten their compliance measures. Mastercard will be on the lookout for the sturdy coins that the crypto community flocks to for their security and reliability and add them to the network.
There are four criteria Mastercard will look for in a digital asset before it is supported. Since Mastercard provides payment services, the crypto asset must be useful as a stable spending method rather than investing. The currency must comply with local laws and regulations in the areas in which it is used. There must also be strict compliance protocols in place, e.g. B. KYC (Know Your Customer) measures.
Finally, and most importantly, Mastercard needs to be able to offer the same high standard of consumer protection as it does for its credit cards. This includes the confidentiality and security of customer information.
Mastercard has already been involved in many crypto collaborations, for example the creation of cryptocurrency cards for BitPay and Wirex last year and for the crypto exchange LVL this year. In these partnerships, the crypto companies convert the digital assets to fiat before sending them over the Mastercard network. Direct support for digital assets avoids inefficiencies and allows more merchants to accept cryptocurrencies as a means of payment.
Mastercard is also currently working with various governments on the development of central bank digital currencies (CBDCs) and last year launched a test platform to help banks assess CBDCs. The payments company already has one of the largest blockchain patent portfolios in the industry, including 89 blockchain patents and 285 pending blockchain filings, and is working to become part of the future of payments and crypto.