Mastercard has announced its plans to partner with self-custody wallet companies in the Web3 world. The company has already partnered with MetaMask and Ledger, among others, as part of its Web3 strategy workshop. Mastercard sees the value in collaborating with wallet providers as it can stimulate user acquisition and generate additional revenue streams. Cardholders will also be able to easily spend their credit in cryptocurrencies. Mastercard is exploring new models for global issuance, including the use of stablecoins and low-cost fast chains. The company aims to bring its trusted and transparent approach to the world of digital assets through innovative products.
Credit card networks like Mastercard are increasingly getting involved in cryptocurrencies. Mastercard’s Engage program focuses on launching new crypto card programs, while Visa is working with USDC stablecoin and the Solana blockchain for cross-border payments. Mastercard is also developing franchise standards to ensure consumer protection and transaction monitoring requirements. The company acquired CipherTrace to provide monitoring services. Once the proposed standards are validated, Mastercard could issue cards for the EU or UK market, offering simple solutions for seamless transactions without pre-funding or high transaction fees.
In another initiative, Mastercard collaborated with the Reserve Bank of Australia (RBA) to explore how central banks can implement central digital currencies (CBDCs) on public blockchains. This collaboration could provide an alternative to stablecoins. The pilot involved purchasing NFTs on an Ethereum-based platform and blocking the equivalent amount in digital Australian dollars on the CBDC platform. These CBDC tokens, known as “wrapped tokens,” serve as a stable means of payment within the NFT platform and other applications on the network. The use of wrapped tokens requires KYC checks to prevent illicit activities.
Hot Take: Mastercard’s Collaborations in Web3 and CBDCs
Mastercard’s partnerships with self-custody wallet providers like MetaMask and Ledger demonstrate its commitment to embracing the Web3 world. By collaborating with these companies, Mastercard aims to enhance the value of payment cards for wallet providers and enable cardholders to easily spend their credit in cryptocurrencies. Additionally, Mastercard’s involvement in CBDC initiatives, such as the collaboration with the Reserve Bank of Australia, showcases its interest in exploring the future of digital currencies. As credit card networks like Mastercard continue to innovate and adapt to the crypto landscape, we can expect more seamless and secure payment solutions for crypto users in the future.
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