Mastercard will help banks offer cryptocurrency trading

Mastercard will help banks offer cryptocurrency trading

by Virtusenews
24. October 2022
Mastercard will help banks offer cryptocurrency trading

Mastercard is looking to bring crypto to the masses by making it easier for banks to get involved.

The payments giant plans to announce a program Monday that will help financial institutions offer cryptocurrency trading, the company told CNBC. Mastercard will act as a “bridge” between Paxos, a crypto trading platform already used by PayPal to offer a similar service, and banks, according to the company. Mastercard and Paxos will handle regulatory compliance and security  — two core reasons banks cite for avoiding the asset class.

Some consumers have been skeptical, too. Cryptocurrencies like bitcoin are known for volatility, and the world’s top digital assets have lost more than half of their value this year. The industry has suffered billions in hacks since January, coupled with multiple high-profile bankruptcies.

Mastercard’s chief digital officer said polling still shows demand for the asset, but roughly 60% of respondents said they would rather test the waters through their existing banks.

“There’s a lot of consumers out there that are really interested in this, and intrigued by crypto, but would feel a lot more confident if those services were offered by their financial institutions,” Mastercard’s chief digital officer, Jorn Lambert, told CNBC in an interview. “It’s a little scary to some people still.”

Large investment banks like Goldman Sachs, Morgan Stanley and JPMorgan have dedicated crypto teams but have largely avoided offering it to consumers. Just last week, JPMorgan CEO Jamie Dimon called cryptocurrencies “decentralized Ponzis” at an Institute for International Finance event. If banks do embrace this Mastercard partnership model, it may mean more competition for Coinbase and other exchanges operating in the U.S.

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