Mastercard to Introduce Cryptocurrency Payments and Add Stablecoins

February 19, 2021, by Cris
Payments giant Mastercard is preparing to introduce cryptocurrency support, according to an announcement published on Feb. 10.
Mastercard cryptocurrency

Mastercard says that it will support selected cryptocurrencies on its network. This will enable customers, merchants, and businesses to use cryptocurrency as an optional alternative to standard payments.

The company has not said which cryptocurrencies will be available. However, it says that it will begin by supporting stablecoins, the most regulated type of cryptocurrency at the moment.

That statement implies that dollar-pegged coins like Tether (USDT) and USD Coin (USDC) will be available on the network. It also implies that Mastercard will not initially support Bitcoin.

Related Plans from Mastercard

In its announcement, Mastercard notes that it has already worked with companies like Wirex and BitPay to create cryptocurrency payment cards. It says that it intends to continue with similar partnerships.

Mastercard noted that it only handles cryptocurrency converted to cash within those partnerships. By contrast, its decision to support cryptocurrency will see the company handle cryptocurrency balances natively.

The firm is also developing a test environment in which banks can trial central bank digital currencies (CDBCs), a specific type of stablecoin.

Crypto Credit Cards

One of Mastercard’s largest competitors, Visa, also announced support for cryptocurrency last year. Similar to Mastercard, Visa allows certain clients to issue customized cryptocurrency payment cards.

Though mainstream support for cryptocurrency is encouraging, some see the trend as undesirable. Payment processors have central control over their network, giving them the power to block payments and suspend users.

That arguably undermines the central goal of Bitcoin, which was designed to remove restrictions around spending and personal finance.

Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.