Mastercard to Explore New Crypto Partnerships
Raj Dhamodharan, Mastercard’s head of crypto and blockchain, has announced the company’s plans to expand its cryptocurrency payment card program. This move comes despite recent scrutiny by regulators on banks and the cryptocurrency industry. Mastercard aims to provide people with secure access to cryptocurrency through further collaborations with crypto businesses.
Existing Crypto Card Partnerships
Mastercard has already partnered with hundreds of international crypto card program providers, including major cryptocurrency exchanges such as Binance, Nexo, and Gemini. Through these partnerships, users with Binance cards, for example, can pay in conventional currencies using funds from their exchange-held bitcoin holdings.
Concerns Over Crypto Transactions
Banks have become more cautious when dealing with cryptocurrency clients due to the failure of several major cryptocurrency companies last year, including leading exchange FTX. To protect customers from fraud and scams, some banks like Santander and NatWest have set limits on the volume of money UK residents can transfer to cryptocurrency exchanges.
Visa, Mastercard’s main rival, ended its international credit card arrangements with FTX in November 2022. American Express stated in February that it did not expect cryptocurrency to soon replace its primary lending and payment services.
Increased Regulatory Enforcement
US officials are intensifying regulatory enforcement, citing concerns about market compliance. Binance, the world’s largest cryptocurrency exchange, was sued in March by the US Commodity Futures Trading Commission for allegedly running an “illegal” exchange and a “sham” compliance program.
Mastercard’s Stance on Limited Transactions
When asked if Mastercard would consider limiting the amount of money transferred to cryptocurrency exchanges via its payment network, Dhamodharan stated, “We’re not here to pick winners. We’re not here to pick which transaction should or shouldn’t happen.”
Dhamodharan also highlighted Mastercard’s investment in crypto analytics technologies and the requirement for Mastercard network users to pass compliance tests. He emphasized the company’s enthusiasm for the underlying blockchain technology and its anticipation of increased cash flow despite heightened regulations.
