Mastercard announced on Monday, 17 October the launch of a program that will allow banks offer secure crypto trading to their customers by verifying transactions and helping financial institutions follow compliance rules. The program called Crypto SourceTM was developed in partnership with Paxos, a crypto trading platform used by companies like PayPal. Mastercard's financial institutions partners will gain access to a comprehensive selection of buy, hold, and sell services for select crypto assets. Said crypto assets will be augmented with a proven identity, cyber security and advisory services.
In addition to Crypto SourceTM, Mastercard is also launching Mastercard Crypto SecureTM, bringing additional security to the crypto program and supporting card issuers in their regulatory compliance.
Mastercard's Chief Digital Officer states that polling shows demand for crypto assets, stating in an interview with CNBC, “There are many consumers … that are interested in this, and intrigued by crypto, but would feel a lot more confident if those services were offered by their financial institutions.”
The Chief Digital Offer also said that Mastercard is committed to exploring crypto and the underlying digital assets technology to support consumer choice in payments.
Mastercard has been working alongside its customers and partners over the past few years in bringing new services and capabilities for safer, more secure, and more accessible crypto services. Currently, Mastercard has several crypto-related technologies and services like Finicity, Ekata, RiskRecon and CipherTrace. Additionally, Mastercard supports financial institutions and governments through its Crypto & Digital Currencies Consulting Services.
Mastercard's Crypto SourceTM will include numerous crypto-related services. In addition to the buying/holding/selling of select crypto assets, the program offers crypto spending and cash-out capabilities through various products, including crypto cards, open banking, and cross-border services. Crypto program management is also included, with program design, product development and technology implementation support.
Large investment banks like Goldman Sachs, Morgan Stanley, and JPMorgan have dedicated crypto teams but have largely avoided offering it to consumers yet. However, if banks do embrace this Mastercard partnership, it may result in more competition in the US for Coinbase and other cryptocurrency exchanges. This is another step towards the inevitable – mass adoption.
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