Mastercard revealed earlier this year that it was preparing to support cryptocurrency directly on its network.
Raj Dhamodharan, Mastercard’s digital asset and blockchain VP wrote in a blog post that it was a big change requiring much work.
He added that they had to be mindful of what assets to support based on their principles for digital currencies. Their main focus was customer protection and compliance.
He wrote that no matter what the views were, the fact is crypto is becoming an integral part of the payments world.
Dhamodharan reiterated that Mastercard could see card users purchase crypto assets. To top it off, it could also see that users were using crypto cards to access these assets. And these assets weren’t just accessed but were converted to conventional monies for spending across the network.
He clarified in his post that Mastercard wasn’t shifting peoples’ interest to cryptocurrency but was merely giving them a choice. Mastercard’s aim is to facilitate consumers, merchants and businesses alike, to shift to digital value.
According to Mastercard advancing work on crypto on its network would generate an array of opportunities for shoppers and merchants. However, Mastercard is very clear on its stance to not support all Cryptocurrencies. For Mastercard, its customers’ safety is above everything. It believes that many of the digital currencies/assets still needed to tighten to the company’s compliance measures.
He further wrote that in the near future customers and the entire network in fact would divert its attention to reliable and secure cryptocurrencies. It were these very stablecoins that the company expected to bring within its network.
Mastercard would have to work on a number of aspects before it can transact cryptocurrency on the Mastercard network. The company will have to start off with determining consumer protection terms, which include privacy and security of consumers’ information.
It will need to ensure strict compliance protocols, such as Know Your Customer. The company should have a system that makes everything very clean and transparent while sniffing out illegal activity and deception in payment networks. The digital asset or cryptocurrency must abide by the local laws and regulations according to its related jurisdiction, ensuring its stability.
Last year Mastercard used third-party payment platforms like Wirex and BitPay to create crypto cards allowing people to transact using their cryptocurrencies. This meant cryptocurrencies weren’t moving directly through Mastercard’s own network.
However, with the latest development, this third-party asset conversion is going to change and cryptocurrency would be directly available on Mastercard’s network. The blog post explained that the change would eliminate inefficiencies. This would relieve the customers and merchants of the hassle of back and forth conversion between crypto and traditional currency.
Additionally, Mastercard is also in talks with several banks around the globe as they plan to venture into digital currencies.