Mastercard has started a partnership with Bakkt (a cryptocurrency firm) to allow payments of crypto on its network. Banks and merchants will soon be able to use different cryptocurrencies for payments, a large step of adopting cryptocurrencies like Bitcoin, Cardano, Etherium, and many other coins. Also, Crypto wallets will be included that give out rewards for holding coins. Even loyalty programs where spending real money on airlines and hotels can be converted to Bitcoin as a reward will be possible.
There will be many advantages once Mastercard accepts cryptocurrency on the payment network. To do so, Mastercard is partnering with Bakt. A crypto firm recently spun off by Intercontinental Exchange. This is the behind-the-scenes operator for those who sign up. The announcement could lead to a significant expansion in the ways regular Americans earn and spend bitcoin and other cryptocurrencies. Mastercard runs one of the dominant global payments networks along with Visa and has relationships with more than 20,000 financial institutions around the world. There are 2.8 billion Mastercards in use, according to the company.
This will give a huge boost to cryptocurrency in general, with even an easier way for anyone to accept cryptocurrency. Bitcoin for example was trading today at 63K USD. Just over 2 months ago Bitcoin crashed to 32K USD. Bitcoin has doubled since then. Many experts expect Bitcoin (and other currencies) to grow even more rapidly. Once the Mastercard-Crypto system is live there is expected for many Americans to invest even more.
Mastercard & Bakkt
Bakkt went public last week after the news of the partnership shares of Bakkt went up by 100%. The partnership also means that even merchants and restaurants can offer rewards in Bitcoin and other cryptocurrencies instead of traditional loyalty points. Giving a larger use case to the whole cryptocurrency space. This is a huge push for the adoption of crypto in general!
Mastercard said the following on their website: “We are here to enable customers, merchants, and businesses to move digital value — traditional or crypto — however, they want. It should be your choice, it’s your money.” Mastercard won’t allow every crypto coin though. There are many who are not secure or not up to Mastercards standards. Which crypto coins these are is not sure.
Mastercard is also currently engaging with several major central banks around the globe as they are preparing plans to launch new digital currencies (central bank digital currency/CBDC’S). The company has created test environments for central banks to test this new form of currency. Mastercard is basically paving the way to worldwide crypto adoption. Partnering with Bakkt is a huge push towards this goal. Mastercard wants to enable more users to use crypto if they want to, however, Mastercard does not want to force adoption. They understand that many people will leave their banks if they are unable to use cryptocurrencies. It is important to accept crypto rather than block it. The payment provider luckily sees the huge increase of crypto payments and wants to help Merchants and banks to get in on the action.