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Mastercard, one of the largest financial institutions globally, is planning to launch a program to assist financial institutions that want to offer cryptocurrency trading services to their clients. Mastercard has made several moves to support its foray into the crypto industry.
Mastercard to allow financial institutions to offer crypto services
The financial services company plans to serve as a “bridge” between the Paxos cryptocurrency trading platform and banks. The goal of the partnership is to provide regulatory compliance and security services.
The lack of regulatory clarity and security has been named the main reason banks avoid the asset class. The chief digital officer at Mastercard, Jorn Lambert, said that many consumers were interested in the crypto sector and more likely to venture into the space if traditional financial institutions offer these services.
“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. It’s still scary for some people out there,” Lambert said.
The company has also said it will assist financial institutions in following regulatory requirements in the crypto sector. The company also plans to verify transactions, adhere to anti-money laundering requirements and detect monitoring services.
The company is also expecting to pilot the product launch during the year’s first quarter. The company is also planning to expand into different regions globally. Mastercard has not provided any details on the banks that have signed up for this offering.
The cryptocurrency sector is currently affected by one of the most challenging bear markets in history. However, Lambert has said that he anticipates a rise in activity in the near term that could assist Mastercard in attracting more transactions and supporting its core business.
The executive has also said it was short-sighted to believe that the cryptocurrency winter meant the asset class was ending. Lambert has also said that regulatory compliance would improve the platform’s security and resolve the issues the sector has been facing over the years.
Mastercard’s plan for the crypto sector
Mastercard has been pursuing several crypto-related initiatives in 2022. The company announced a partnership with the Gemini cryptocurrency exchanges to launch a crypto card that will pay rewards in cryptocurrencies in the United States.
In Argentina, Mastercard launched a prepaid card with the Binance exchange to allow users to make purchases and pay bills using their cryptocurrency holdings at over 90 million merchants globally using the payment services that Mastercard offers.
Over the past few years, Mastercard has also partnered with several leading industry players in the crypto sector. Some industry players partnered with Mastercard include Circle, Evolve, Paxos, and Uphold. These companies are looking into how users can convert their cryptocurrencies into fiat and make payments.
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