Mastercard Enable Crypto Products & Services For Its Merchants Network
Mastercard announced a partnership with a cryptocurrency exchange Bakkt to enable its partners and merchant network in the U.S. to offer crypto solutions, including the buying, selling, and holding of cryptocurrencies.
To facilitate the service, Mastercard has collaborated with Bakkt – which will provide crypto-custody services for clients behind the scenes. Bakkt has partnered with multiple corporate giants in the past including Google, and was recently listed on the NYSE recently.
The partnership aims “to make it easier for merchants, banks, and fintechs in the U.S. to embrace and offer a broad set of cryptocurrency solutions and services,” the announcement details. “Bakkt extends Mastercard’s ecosystem of cryptocurrency partners enabling crypto-as-a-service, which provides quick access to cryptocurrency capabilities.”
The two companies explained:
“Mastercard partners will be able to offer cryptocurrency solutions. These include the ability for consumers to buy, sell and hold digital assets through custodial wallets powered by the Bakkt platform and streamlined issuance of branded crypto debit and credit cards.”
MasterCard has relationships with more than 20,000 financial institutions worldwide, and there are 2.8 billion Mastercards in use, according to the company. An October 2019 Nilson Report states that Visa and Mastercard both had 52.9 million merchants — more than any other companies worldwide.
Mastercard further revealed that crypto will also be integrated into its loyalty solutions, allowing its partners to offer crypto as rewards and enable fungibility between loyalty points and other digital assets. The announcement adds:
“This means that consumers can earn and spend rewards in cryptocurrency instead of traditional loyalty points and seamlessly convert their crypto holdings to pay for purchases.”
Sherri Haymond, Mastercard’s executive vice president of digital partnerships, said:
“We want to offer all of our partners the ability to more easily add crypto services to whatever it is they’re doing. Our partners, be they banks, fintechs, or merchants can offer their customers the ability to buy, sell and hold cryptocurrency through an integration with the Bakkt platform.”
Bakkt CEO Gavin Michael commented:
“We’re lowering the barriers to entry, allowing people to take something like your rewards points and trade them into crypto. It’s an easy way to get going because you’re not using cash, you’re putting something that’s an idle asset sitting on your balance sheet, and we’re allowing you to put it to work.”
Meanwhile, a Bakkt partnership announced Monday afternoon with Fiserv will allow for similar capabilities, allowing for merchants to expand their crypto payment offerings.
Bakkt shares went live on the New York Stock Exchange on Oct. 18 after a SPAC deal that valued the company at about $2.1 billion. The firm’s current market capitalization is over $4 billion.
