Credit card and finance company Mastercard Inc. accelerating its foray into the cryptocurrency industry with Crypto Secure, a program that will make it easier for banks and other financial institutions to offer cryptocurrency trading.
The Crypto Source program is designed to allow Mastercard’s users to buy, hold and sell cryptocurrencies through participating banks by expanding an existing partnership with Paxos Trust Co. Paxos is known for providing similar services to the payments giant PayPal Holdings Inc., which launched its own crypto services in 2020.
Financial institutions that sign onto Crypto Source will offer premium cryptocurrency services for customers, allowing them to support select crypto assets. Paxos will manage asset trading and custody services, while Mastercard will integrate into banks.
The platform will also manage regulatory compliance and security management using Mastercard’s existing identity solutions, crypto analytics, transaction monitoring, anti-money-laundering, “Know Your Customer,” cybersecurity and biometrics.
Crypto Source will also be complemented by Mastercard’s recently launched service Crypto Secure, which uses artificial intelligence and blockchain data powered by CipherTrace to combat fraud and use technology from Ektata, an identity verification company acquired by Mastercard in 2021.
“At Mastercard, trust is our business. What we are announcing today is a connected approach to services that will help bring users safely and securely into the crypto ecosystem,” said Ajay Bhalla, president of cyber and intelligence at Mastercard. “Our recent investments in this space, such as the acquisition of CipherTrace and Ekata, are providing us with a unique set of capabilities to help provide our customers and consumers with the most technically advanced solutions available in the market.”
Banks will be able to offer customers a number of cryptocurrency spending and cash-out options through a range of different products including crypto-linked cards, open banking and cross-border services that can transfer money in minutes instead of days. Mastercard will also offer banks the ability to use digital receipts and loyalty solutions using crypto assets.
Mastercard has been exploring blockchain and crypto payments technologies since 2016 when it introduced it as part of its developer programs.
The company’s continued moves into the cryptocurrency payments space mirror its rival Visa’s own exploration of the technology. It announced plans to allow crypto settlements on its own network in partnership with Crypto.com in 2021. Visa partnered with the global cryptocurrency exchange FTX earlier this month to offer crypto-linked debit cards in 40 countries.
“Our commitment is simple – to explore crypto and the underlying digital assets technology to support consumer choice in payments,” said Jorn Lambert, chief digital officer at Mastercard. “Our crypto product innovations will provide choice at scale and continue to bring one-of-a-kind opportunities to financial institutions as they seek to offer new, advanced services to their customers.”
Mastercard Crypto Source is currently planned for a pilot program and is expected to launch into general availability at a later date.