Paxos and Mastercard will handle security and regulatory compliance, which are the two major reasons financial institutions have been citing for avoiding the asset class.
Mastercard will act as a “bridge” between Paxos, a cryptocurrency trading platform already in use by Paypal for similar services, and financial institutions, according to MasterCard.
A lot of consumers have been hesitant as well, Bitcoin, for instance, is known for volatility, same with other cryptocurrencies, and since the beginning of this year, the world’s top digital asset has lost more than half of its value, also, there have been a lot of attacks on the crypto industry by cyberpunks, high profile bankruptcies is another issue causing investors to be wary of investing.
“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.”
Investment banks like Goldman Sachs and JP Morgan have teams dedicated to crypto, but have refused to offer it to customers, days ago, JP Morgan CEO said cryptocurrency is a “decentralized Ponzis” at a finance event, should financial institutions this Mastercard partnership mode, it may mean competition for crypto exchanges in the United States.
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More Payments Giants are Entering the Crypto Space
MasterCard and its major competitors are striking different deals with crypto firms to see them becoming one of the biggest players in the crypto space.
As earlier reported by MyCryptoParadise, Visa recently partnered with Sam Bankman-Fried FTX, one of the world’s largest cryptocurrency exchanges to roll out crypto debit cards in 40 countries across the globe, the payment company also has more than 70 crypto partnerships currently.
MasterCard as part of its quest to gain its space in the crypto world has joined hands with Coinbase, a US largest cryptocurrency exchange on NFTs and Bakkt to let banks and merchants in its network offer crypto-related services.
Also, American Express has revealed that it is working on making possible the use of its credit cards and networks with stablecoins, which are tied to any hard currency.
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