The latest news from Mastercard as it plans to partner with self-custody wallet companies in the Web3 world.
Specifically, the payments giant has partnered with MetaMask and Ledger, among others, as confirmed in a presentation during the Web3 workshop.
See below for all the details.
Mastercard’s projects in Web3: Collaborations with self-custody wallets
As expected, Mastercard is actively seeking ways to collaborate with self-custody wallet providers, including MetaMask and Ledger, according to a report on a Web3 strategy workshop seen by CoinDesk.
In a presentation, Mastercard highlighted the added value a payment card can bring to wallet providers by stimulating the acquisition of active users and driving additional revenue streams.
At the same time, cardholders can easily spend their credit in cryptocurrencies.
Wallet companies often face significant resource challenges when trying to launch cards in new geographies, which is where Mastercard and its issuing partners come in.
The payments technology company, with more than half a century of experience, is also exploring new models for global issuance, including the use of stablecoins in settlement chains and the adoption of low-cost fast chains, as mentioned in the presentation.
A Mastercard spokesperson said via email that the company is bringing its trusted and transparent approach to the world of digital assets through a number of innovative products, including the Mastercard Multi-Token Network, Crypto Credential, the CBDC Partner Programme and new card programmes that bridge the worlds of Web2 and Web3.
Credit card networks conquer crypto: the future of innovative payments
In addition, despite market challenges and regulatory uncertainty, the major credit card networks are stepping up their involvement in cryptocurrencies.
Mastercard, for example, has clearly defined the goal of its Engage programme, which focuses on launching new crypto card programmes.
Meanwhile, Visa is working with the USDC stablecoin and the Solana blockchain for cross-border payments, as well as exploring solutions to challenges such as Ethereum’s gas fees.
In addition, Mastercard is developing franchise standards that set rules for partner companies to ensure consumer protection, price competitiveness and transaction monitoring requirements.
The company acquired CipherTrace, an expert in blockchain analysis, in 2021 to provide monitoring services.
Once the proposed standards are validated, the next step could be to issue cards for the EU or UK market, with the aim of providing users with simple solutions for seamless transactions, without pre-funding, without direct cryptocurrency spending and without high transaction fees.
Mastercard collaborates with Reserve Bank of Australia to explore future of CBDCs on public blockchain
Mastercard has recently participated in a collaboration with the Reserve Bank of Australia to demonstrate how central banks can implement central digital currencies (CBDCs) on public blockchains.
This initiative could provide a significant alternative to stablecoins.
The New York-based financial conglomerate joined the pilot with the Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Center, a $115 million research programme funded by the government, universities and financial institutions.
Other participants include payment platform Cuscal and non-fungible token (NFT) specialist Mintable. The pilot involved the purchase of NFTs on an Ethereum-based platform.
The equivalent amount in digital Australian dollars (eAUD) was then blocked on the CBDC platform and corresponding CBDC tokens were created.
These CBDC tokens, known as “wrapped tokens”, are tokenised representations of digital assets with a specific value that can be used on different networks through the use of smart contracts.
With eAUD locked, these wrapped tokens serve as a stable means of payment within the NFT platform and on any other application on the network. Users also have the option to convert the wrapped eAUD on other blockchain networks.
A key condition for using the wrapped tokens is that the buyer and seller addresses are subject to Know Your Customer (KYC) and risk assessment checks, and are whitelisted to prevent the new technology from being misused for illicit activities.