Could Mastercard be a driving factor for mass crypto adoption?
Mastercard CEO Michael Miback recently announced the company’s next move in its partnership with Binance, the leading global crypto exchange in terms of daily trading volume.
According to Mibach’s LinkedIn account, MasterCard will enable users to make crypto purchases at over 90 million stores in Argentina that accept MasterCard.
Meeback shared the giant payments vision, saying that by bringing crypto for daily purchases, “Unlock the full potential of blockchain technology when we make it easy to access + easy to use,” He added, “To make this a reality, we are working with Binance to allow people to use their crypto to shop at 90m+ stores that accept MasterCard.”
More Interest in Crypto Adoption
Prior to the move, the two entities teamed up earlier this month to launch a new prepaid card in Argentina.
Binance Card will simplify the cryptocurrency conversion process to fiat currency in real time. The move enables cardholders in the country to maintain 8% cashback under cryptocurrencies at specific merchants.
Binance, the world’s leading exchange, is also planning to expand its card offering through a long-term collaboration with Mastercard. CEO Changpeng Zhao hinted at the launch of the Argentina card on July 24 and revealed that the card will be available in other regions as well.
Argentina is one of the countries with the highest inflation rate in the world. This issue has prompted people to turn to crypto and digital assets have played an important role here.
Compared to 4 years ago, the peso Argentina (ARS) has lost three-quarters of its value against the dollar. During the same period, bitcoin is up 114% against the dollar and 1.350% against the peso.
Overall, the current state of high inflation has prompted Argentines to adopt cryptocurrencies. However, financial instability in this country also poses many risks for investors.
Mastercard has extensive experience in helping cryptocurrency holders use its network to make payments against fiat currency. However, this integration with Binance is seen as a big step forward for the payment service provider.
Visa sees potential
Like MasterCard, Visa is working on expanding its presence in Latin America. Visa has always competed directly with Mastercard, and the crypto business is no exception.
The payments giant has tied up with Crypto.com, Alterbank, Zro Bank, Agrotoken and Satoshi Tango. In addition, the company collaborated with Tribal Credit to provide card services to small and medium-sized enterprises.
Visa announced the launch of a new bitcoin (BTC) cashback prepaid card in Brazil in September 2021. The Ripio card was developed by Brazilian crypto trader Ripio in collaboration with Visa.
The prepaid card will store cryptocurrency, which Ripio will only convert to fiat currency when the card is used to make purchases. This time around, the unique feature being developed by Visa is for Ripio card users to receive a 5% refund in bitcoins after their first transaction using the card.
no one wants to be left behind
Not only MasterCard and Visa, but many other fintech businesses such as CashApp and PayPal, have consistently implemented blockchain for payment and administrative tasks.
These businesses are united in the belief that digital currencies will one day dominate the payment system.
Transaction fees, which are a headache for customers, are a challenge that both Visa and MasterCard will have to deal with.
In most cases, these businesses will operate for a fee of three to four percent of the total value of the transaction; The exact percentage can vary depending on the banks they collaborate with.
At this stage, cryptocurrency can be considered an investment option that comes with a high degree of risk.
However, payment processing businesses are betting that crypto will one day be used as a form of payment for a variety of purchases that people make on a daily basis, and they don’t want to lag behind in technological advances.
Payment companies say security risks are also a major concern for card payments involving digital currencies. Many people store crypto in wallets with a high risk of being hacked on exchanges or in third party services.