Mastercard is planning on giving merchants the option of receiving payments directly in cryptocurrencies later this year, through a new functionality that would add on existing partnerships that let consumers pay in crypto, but converts the funds to fiat.
According to a blog post published by Mastercard’s executive vice president for digital assets Raj Dhamodharan, the firm is opening its network to allow merchants to receive cryptocurrency payments directly after pointing out it’s been seeing growth in the crypto sector.
Dhamodharan’s post starts by pointing out digital assets “are becoming a more important part of the payments world,” before adding that people are using the company’s network to buy cryptoassets, especially after the price of bitcoin recently surged to a new all-time high above $48,000.
The post adds:
We are preparing right now for the future of crypto and payments, announcing that this year Mastercard will start supporting select cryptocurrencies directly on our network. This is a big change that will require a lot of work.
It notes that Mastercard will be “very thoughtful” about which cryptoassets are supported, based on its principles for digital currencies. Per CoinDesk, cryptocurrencies will be evaluated against Mastercard’s 2019 “Principles for Blockchain Partnerships” framework, which emphasizes stability, consumer protection, and regulatory compliance.
Dhamodharan added that the firm’s philosophy on cryptocurrencies is simple, as it’s about choice and Mastercard “isn’t here to recommend you start using cryptocurrencies.” Instead, it wants to enable customers, merchants and businesses to move value.
The post reads:
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.
It further points out that not all cryptocurrencies will be supported on the network, but hints stablecoins may be first in line as they are “more regulated and reliable than in the recent past,” even though most circulating cryptoassets “need to tighten their compliance measures” to meet the firm’s requirements.
Mastercard will be looking for cryptoassets that can provide consumer protections including privacy and security of information, as well as compliance including know-your-customer checks. It concludes that “to reach out network, crypto assets will need to offer the stability people need in a vehicle for spending, not investment.”
Mastercard has already partnered with several cryptocurrency firms, including Uphold and Wirex, allowing crypto users to pay with cryptocurrencies. The funds were, however, converted to fiat before they reached merchants.
Featured image via Pixabay.