One of the primary reasons cryptocurrencies were created was to help improve the speed and effectiveness of making payments. While investment and speculation are always acceptable use cases, payment processing remains a primary pain point for many crypto users.
For now, the predominant force in payment processing has been credit cards. People and companies use credit cards for just about anything these days because they are near seamless. But, credit card companies have seen the emergence of cryptocurrencies and have been doing their best to incorporate them in order not to be usurped.
One company that is starting to make significant headway in this aspect is MasterCard. The New York company has been ramping up its adoption of cryptocurrencies for the past few years, and efforts have kicked into high gear in 2021.
Cards for Everyone
Over the past two months, no credit card company has been more supportive of the crypto space than MasterCard. The company began July by announcing that it would revamp its crypto credit card program in order to allow banks and financial institutions to issue crypto cards to their customers.
In a press release, MasterCard explained that it would join its partners to test new capabilities that will help companies issue crypto cards to anyone. These cards will be useful anywhere that accepts MasterCard payments.
The partnership includes several top companies in the crypto and financial spaces. These include Metropolitan Commercial Bank, Paxos, Circle, BitPay, Uphold, and much more. MasterCard hopes to incorporate companies in every step of the payment processing business, ensuring that customers can easily convert their cryptocurrencies to traditional fiat.
The credit card program has now added CoinJar - one of the crypto industry’s leading payment services. CoinJar announced earlier this month that it had partnered with MasterCard to allow Australians to spend cryptocurrencies with fiat.
With the new CoinJar card, users can make purchases in crypto wherever MasterCard is accepted. The card is available to users through physical and digital cards, as well as integration with Google Pay and Apple Pay. It will also support over 30 cryptocurrencies.
Building the Future of Crypto Payments
Days later, MasterCard announced a new startup engagement program that will join its MasterCard Start Path - the company’s accelerator program for FinTech startups. The Start Path program looks to support companies working in the digital asset, blockchain, and cryptocurrency spaces.
The new engagement program now has seven startups, spanning different areas of the blockchain and crypto spaces. Their addition is in line with MasterCard’s commitment to expand and speed up growth and innovation in the digital asset technology space.
Startups will be able to address pain points with support from MasterCard. They can connect to MasterCard’s ecosystem of merchants, banks, and partners to provide their solutions.
Jess Turner, MasterCard’s executive vice president of digital infrastructure and fintech, pointed out that they have been involved in crypto for years now.
“We believe we can play a key role in digital assets, helping to shape the industry and provide consumer protection and security. Part of our role is to forge the future of cryptocurrency, and we’re doing that by bridging mainstream financial principles with digital assets innovations,” Turner added.
The Start Path program is similar to an accelerator program that has been launched by VISA - MasterCard’s main competitor - for years. MasterCard is now hoping to build the next generation of companies to transform crypto-based payments and ensure that they do their work on the back of its technology.
Supporting Governments With CBDCs
Even away from private cryptocurrencies, MasterCard is also doing a great deal of work to provide support for governments in their bids to launch cryptocurrencies. In a recent speech, company chief executive Michael Miebach explained that they see different countries working on central bank digital currencies (CBDCs), and they want to ensure that they can help.
"What we believe we do is bring a perspective to the market as a multi-rail payment provider. We have to be in this space because people are looking for answers." Miebach said.
As the CEO explained, MasterCard hopes to be a platform that supports international value flows - essentially, supporting the transfer of one CBDC for another in the same way it does for fiat.
Publicly, MasterCard has already rolled out a virtual testing environment that can help central banks to simulate the issuance, distribution, and use of CBDCs between different parties. The platform supports both retail and wholesale CBDC use. It offers practical insights into how one asset can work with existing payment methods and improve the everyday transactions that people engage in.
Miebach added that countries are faced with the decision of trading off between the existing payment and transaction channels and what a CBDC is solving for. But, whatever they look to improve, they can get support from MasterCard.
Miebach also said that MasterCard is keeping an eye out on the stablecoin sector. With names like USDT and USDC already making waves and Facebook readying for its Diem cryptocurrency, stablecoins are alive and very well. Miebach claimed that MasterCard is beefing up its network to support stablecoins, ensuring that its users can meet the regulatory obligations and ensure safety in transactions.