MasterCard to facilitate cryptocurrency transactions

 MasterCard to facilitate cryptocurrency transactions

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Cryptocurrencies are becoming increasingly accepted as a form of payment, and Mastercard is joining the trend.

The payment processor has not disclosed which cryptocurrencies it will support, and its current requirements may rule out most (if not all) of them.

The move is another recent step in legalizing cryptocurrency and the technology behind it.

Why is Mastercard Taking the Next Step with Crypto

Mastercard has tracked customer usage as it relates to cryptocurrencies, especially Bitcoin. The company saw that consumers were using debit Mastercard cards to buy crypto assets and start using crypto cards on its network.

With the increasing acceptance of cryptocurrencies as an investment and payment method, Mastercard is taking steps to make it easier to deal with secure digital currencies.

The network will add encryption this year, but there are hurdles

Mastercard's announcement says consumers will be able to start transacting in cryptocurrencies on its network sometime in 2021.

However, some experts have questioned the feasibility of implementing based on Mastercard's requirements. According to the company, cryptocurrencies must meet certain criteria to be considered. These include:

Provide strong consumer protection, including privacy and security of consumer information and transaction data.

Allow all stakeholders, including financial institutions, merchants, and mobile network operators, to contribute to and benefit from their blockchain networks.

Act in accordance with applicable laws and regulations, including anti-money laundering laws.

According to a report by Ars Technica, it is not clear if any of the current cryptocurrencies can meet all three of these requirements. In fact, it will be difficult to maintain the decentralized nature of digital currencies in a regulatory environment.

Although Mastercard has not specified which assets will be added to its network, the announcement is one of several initiatives that further legitimize the use of cryptography. Last week, for example, BNY Mellon, Tesla and Venmo also announced plans to incorporate Bitcoin into their business offerings.