Mastercard wants to make it easier for banks to get involved in the world of cryptocurrencies.
According to CNBC, the payments giant plans to announce a program on Monday that will allow financial institutions to offer trading in cryptocurrencies. According to the company, Mastercard will act as a bridge between Paxos and banks. Regulatory compliance and security will be handled by Mastercard.
Consumers have been skeptical as well. The world's top digital assets have lost more than 50% of their value this year. Billions of dollars have been lost in hacks since January.
According to Mastercard's chief digital officer, polling still shows demand for the asset, but a majority of respondents prefer to use their existing banks.
Jorn Lambert, Mastercard's chief digital officer, told CNBC in an interview that a lot of consumers are interested in the technology but would feel more confident if their financial institutions offered it. Some people are still scared.
Investment banks have dedicated teams for it, but they have mostly avoided giving it to consumers. At an Institute for International Finance event, Jamie Dimon called cryptocurrencies a Ponzi scheme. The Mastercard partnership model may mean more competition in the U.S. if banks embrace it.
To keep banks on the right side of regulation, the payments company provides anti-money-laundering and identity checking services. In the first quarter of next year, Mastercard will pilot a product that will be used in more countries. The banks that have signed up are not being named.
While the industry is living through a bear market, more activity down the road could lead to more transactions.
He doesn't see that a little bit of a winter heralds the end of it. There will be a higher degree of security available to the platforms and we will see a lot of the current issues get resolved in the quarters in the years to come.
Both Mastercard and Visa have been involved in partnerships in the digital currency. Banks and merchants in Mastercard's network will be able to offer services related tocryptocurrencies. In the last week, Visa and FTX have partnerships with more than 70 companies in the field ofcryptocurrencies. American Express is looking into using its cards and network with stable coins, which are pegged to the price of a dollar.
Mastercard and Visa were supposed to be disrupted byCryptocurrencies. Their technology allows transactions to be done without the help of others. They haven't seen industry opposition to their involvement He said that there is a need to team up with the incumbent players in order to get there.
It is hard to believe that the industry will not embrace the financial industry as we know it.
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