As Mastercard plans to introduce crypto, Paxos is prepared to offer its trading and custody services

The technology of Mastercard will be used to incorporate crypto trading into bank interfaces

Published: Oct 19, 2022 05:46:36 PM IST

Image: Shutterstock

Mastercard formally introduced a new programme on October 17 that would allow financial institutions to provide their clients with access to crypto trading knowledge and services.

The "Crypto Source" programme combines Mastercard's exclusive crypto secure solution for additional security and compliance with the ability to buy, hold, and trade crypto assets.

According to reports, the technology will be made available in Q4 2022 in conjunction with Paxos Trust Company, a current partner of Mastercard. Paxos, a rival to PayPal, a pioneer in global payments that launched its initial bitcoin services in late 2020, provides comparable services.

As part of the new partnership, Mastercard will use its technology to integrate crypto trading capabilities into bank interfaces, while Paxos will manage custody and trading of bitcoin assets on behalf of the banks.

Ajay Bhalla, the head of Mastercard's cyber and intelligence section, emphasised the company's growing expertise and commitment to the crypto industry. He noted Mastercard's recent investments in the crypto space, including the purchases of the digital identification platform Ekata in April of last year and the crypto intelligence firm CipherTrace in September.

The 2022 Mastercard New Payments Index, which reported that 29 percent of respondents globally hold crypto assets as an investment, was cited by Mastercard in its news announcement. According to reports, another 65 percent of respondents preferred that their current, reliable financial institution offer crypto services.

"What we are announcing today is a connected approach to services that will help bring users safely and securely into the crypto ecosystem," Bhalla noted.

Walter Hessert, the director of the strategy at Paxos, also emphasised the breadth of Mastercard's international network of financial institutions. The new tool will give banks and creditors the "most trusted way to offer safe, reliable crypto assets," the CEO claimed.

Mastercard's most recent crypto initiative comes as the market capitalisation of all crypto assets has decreased by roughly 60 per cent since 2022. It would be shortsighted to think that a little bit of a crypto winter heralds the end of it…As regulation comes in, there is going to be a higher degree of security available to the crypto platforms, and we'll see a lot of the current issues getting resolved in the quarters in the years to come," Jorn Lambert, the chief digital officer at Mastercard stated.

Shashank is founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist.