The payment behemoth recently launched a new crypto product to help banks fight against preventing fraudulent cases associated with digital assets.
The multinational financial services company Mastercard is all set to launch a program to help financial institutions offer cryptocurrency trading to their clients.
The company plans to serve as a “bridge” between the crypto trading platform Paxos and banks to oversee regulatory compliance and security – two major areas that the banks have cited as reasons to avoid the asset class.
Focus on Regulatory Compliance
Mastercard’s chief digital officer, Jorn Lambert, told CNBC:
“There’s a lot of consumers out there that are really interested in this, and intrigued by crypto, but would feel a lot more confident if those services were offered by their financial institutions. It’s still scary for some people out there.”
The company said it will help financial institutions to follow crypto compliance rules, verify transactions, adhere to anti-money-laundering laws, and identity monitoring services. It expects to pilot the product in the first quarter of 2022, then expand in more geographies across the world. Details regarding which banks have signed up so far have not been yet revealed.
The crypto industry is currently caught in one of the most brutal bear markets in its 13-year history. However, Lambert expects to see more activity in the near term, which could help Mastercard fetch more transactions and accelerate its core business. The exec said that it would be “short-sighted” to believe that crypto winter indicates the end of the entire asset class.
While vouching for regulatory oversight, Lambert went on to add that crypto platforms will not only enjoy a “higher degree of security” but will also see many issues to resolve in the years to come.
Mastercard’s Initiatives in Crypto Space
Mastercard announced several new crypto card programs globally this year. The company collaborated with Gemini for a credit card that pays rewards in cryptocurrencies in the US. In Argentina, it rolled out a prepaid card with Binance that lets users purchase and pay bills with their cryptocurrency at more than 90 million merchants that use Mastercard’s payment services.
Over the last couple of years, Mastercard has partnered with key industry players such as Paxos, Circle, Evolve and Uphold to develop ways for users to effectively convert their crypto to fiat to make payments.
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