Morning coffee, a taxi to work, new jeans and buy all this with cryptocurrency.
Whatever your attitude towards cryptocurrency – from enthusiastic fanatic to terrifying skeptic – the fact remains – these digital assets are becoming an integral and increasingly important part of the vast world of payments.
During the recent rise in the value of bitcoin, Mastercard has noticed that people are increasingly using cards to buy cryptocurrencies, and then converting assets into traditional currencies for spending. After weighing all the pros and cons, Mastercard announced that they will start supporting cryptocurrencies, but not all.
Why is Mastercard so picky?
It is impossible to sit on two chairs: be decentralized and regulated at the same time and support all cryptocurrencies. Let’s try to imagine the union of Bitcoin and Mastercard.
“Mastercard” – an international payment system, which owns 26% of payment cards worldwide. In case of fraud or loss of the card, Mastercard may decide to cancel the transfer unilaterally, even after a few weeks. An active fighter against money laundering, terrorism and who knows each of his clients “by sight”.
“Bitcoin” Is the first cryptocurrency that was designed to undermine the power of governments and conventional financial institutions. It’s no secret that Bitcoin has been used for gambling, the darknet, terrorists, drug dealers and other entities who do not want to show themselves. The same arguments apply to other leading cryptocurrencies – Ether, Litecoin, and Dogecoin.
Therefore, Mastercard has so far opted for stablecoins, which are more regulated and reliable than in the recent past. And so that others can make friends with Mastercard, you need to meet the basic criteria:
- Consumer protection, including the privacy and security of consumer information. That is the same level of security that people expect from their credit cards
- Strict compliance protocols, including KYC “Know Your Customer” – a requirement aimed at curbing illegal activity and fraud in payment networks
- Digital assets must comply with local laws and regulations in the regions in which they are used
- Crypto assets should provide the stability people need to spend, not invest
Consequently, in 2021 it may and will be possible to pay with a Mastercard in cryptocurrency, but we are not going to buy coffee for Bitkions in the near future. After all, the words “stability”, “compliance protocols” and “protection” will probably not be able to be put next to the word Bitcoin soon.