On Feb 10, Mastercard announced that it would begin supporting select cryptocurrencies on its payment network. The financial transaction processing company hasn’t specified which cryptocurrencies it will work with, though, and some of its requirements may preclude a number of the major ones.
- Cryptocurrencies are becoming increasingly accepted as a form of payment, and Mastercard is joining the trend.
- The payment processing company hasn’t disclosed which cryptocurrencies it will support, and its current requirements may exclude most (if not all) of them.
- The move is yet another recent step in legitimizing cryptocurrency and the technology behind it.
Why Mastercard Is Taking the Next Step With Crypto
Mastercard has tracked customer usage as it relates to cryptocurrency, particularly Bitcoin. The company has seen consumers using their Mastercard debit cards to purchase crypto assets and begin to use crypto cards on its network.
With cryptocurrencies becoming more accepted as an investment and payment method, Mastercard is taking steps to make it easier for people to transact using secure digital currencies.
The Network Will Add Crypto This Year, But There Are Obstacles
Mastercard’s announcement says that consumers will be able to begin transacting in crypto on its network sometime in 2021.
However, some experts have questioned the feasibility of implementation based on Mastercard’s requirements. According to the company, cryptocurrencies must meet certain criteria to be considered. Those include:
- Provide strong consumer protection, including privacy and security of consumer information and transaction data.
- Allow all stakeholders, including financial institutions, merchants, and mobile network operators, to contribute to and benefit from their blockchain networks.
- Operate in compliance with applicable laws and regulations, including anti-money laundering laws.
According to a report by Ars Technica, it’s not clear if any existing cryptocurrencies can meet all three of those requirements. In fact, it will be challenging to maintain the decentralized nature of digital currencies in a regulatory environment.
While Mastercard hasn't specified which assets will be added to its network, the announcement is one of many initiatives that further legitimize the use of crypto. In the last week, for example, BNY Mellon, Tesla, and Venmo also announced plans to incorporate Bitcoin into their business offerings.