Credit card giant Mastercard has announced that it will help financial institutions offer cryptocurrency trading to their retail customers.
Mastercard Announces Crypto Source
Mastercard has announced a new program called Crypto Source, which will allow banks to offer crypto trading to their customers.
Today’s announcement says that banks will “gain access to a comprehensive suite of buy, hold and sell services for select crypto assets” along with other services.
Specifically, Mastercard will serve as a bridge to the crypto exchange Paxos. Together, the two companies will handle compliance and security matters, meaning that the banks involved in the program will not need to closely manage those risks.
The decision to offer the service was seemingly influenced by Mastercard’s own surveys, which found that 65% of respondents preferred cryptocurrency services to be provided by a trusted financial institution instead of a crypto company.
Jorn Lambert, Mastercard’s chief digital officer, stated in a CNBC interview that many consumers are “intrigued by crypto, but would feel a lot more confident if those services were offered by their financial institutions.”
It is not clear which banks will offer the service, though it seems likely that some major financial institutions will adopt the program given Mastercard’s high standing.
The service is currently in the pilot program stage. Mastercard says that further details on availability will be made available at a later date.
Mastercard’s Crypto Pursuits
Mastercard is already highly involved with cryptocurrency. In 2021, the firm announced plans to bring support for cryptocurrencies, primarily stablecoins, onto its network.
Prior to that, Mastercard began working with various cryptocurrency exchanges to create crypto payment cards, allowing crypto account holders to convert their exchange balance and spend it at point of sale. Exchanges that offer payment cards include Binance, Gemini, Bitpay, and Nexo among others.
This month, Mastercard also announced an anti-fraud service that will help banks calculate the risk of fraud associated with exchanges that use its network. Previously, in September, Mastercard acquired crypto security firm CipherTrace.
Mastercard competitor PayPal is working with crypto as well. In fact, it appears that Mastercard’s service will be quite similar to one offered by PayPal, which began to offer crypto trading through a partnership with Paxos in October 2020.
Meanwhile, Visa has recently partnered with JP Morgan on cross-border blockchain payments and has expanded its FTX crypto card to 40 new countries.