Traditional payments titan Mastercard took another step inside the crypto market this month by announcing its innovative Crypto Secure solution for buying and selling crypto.
Crypto Secure will utilize insights and technology from Mastercards proprietary CypherTrace platform to help card issuers stay compliant with regulatory bodies across the world.
The platform will let card issuers better assess the risks of crypto exchanges and other providers. The benefit of the Crypto Secure platform will be that it can assess large crypto exchanges but also smaller crypto companies.
It wouldn’t be a surprise to see the Crypto Secure branding start popping up on exchanges or other companies that pass CypherTrace audits.
At the end of the day it’s just one more tool to make buying and selling crypto safer for individuals.
Mastercard Continues to Explore Crypto
Mastercard acquired CyperTrace last year in an effort to augment its digital asset infrastructure.
CyperTrace is one of the more respected crypto intelligence companies with a history that dates back to 2015. The intelligence firm has insights into over 900 different cryptocurrencies and a massive amount of data on crypto activity.
There are also a number of crypto-based credit or debit cards that have been released on the Mastercard platform including, perhaps most famously, the Gemini Mastercard.
The Gemini Mastercard is a credit card offered by Gemini Exchange (founded by the Winklevoss twins) that offers cashback in crypto such as Bitcoin or Ethereum.
It sounds like there could be more Mastercard-branded crypto products in the future.
“At Mastercard trust is our business and with cryptocurrency more intertwined in our daily lives this is an exciting next step in our journey” said Ajay Bhalla, President of Mastercard Cyber and Intelligence.
“Crypto Secure will provide card issuers with a platform that allows them access to insights which will improve the safety of crypto purchases, increasing consumer confidence and creating the same trust they expect when paying with Mastercard.”
Mastercard’s biggest competitor, Visa, has also made its own forays into crypto with the BlockFi Visa card and Crypto.com Visa Card.
Are Traditional Payment Processors Antithetical to Crypto?
Of course not everyone is pleased with traditional finance giants getting involved with crypto.
Bitcoin was initially conceived as a sharp retort to centralized banking, which in part led to the great recession in 2008.
Instead decentralization is a key component in crypto as users look to lessen their reliance on traditional banking infrastructure and regain more privacy.
Regardless of where you stand it appears that regulation will play a large role in cryptocurrency over the next few years and less fraud would be a win for everyone involved in the space.
Mastercard’s Crypto Secure will hope to accomplish that by providing every card issuer a color-coded dashboard that shows where their cardholders are buying cryptocurrency.
Furthermore the Crypto Secure service will allow card issuers to do the following:
- accurately identify the crypto exchanges
- measure transaction approvals and declines
- understand, at a portfolio level, their exposure to crypto risk through a single score
- access a benchmark rating for comparison to a peer group of financial institutions
Crypto users will have to decide if providing that amount of information is worth getting extra protection from fraud. They may not have a choice as more rules and regulations regarding crypto will be introduced over the next few years.