MasterCard has partnered with Bakkt to offer MasterCard’s network of merchants, banks, and fintech companies the ability to buy, sell, and hold digital currency. MasterCard is calling this new offering, Crypto-as-a-Service and has decided to offer digital assets to its network of users to give them more variety when it comes to money and payments.
“Mastercard is committed to offering a wide range of payment solutions that deliver more choice, value, and impact every day,” said Sherri Haymond, executive vice president, Digital Partnerships at Mastercard.
“Together with Bakkt and grounded by our principled approach to innovation, we’ll not only empower our partners to offer a dynamic mix of digital assets options, but also deliver differentiated and relevant consumer experiences.”
In addition to giving their network the ability to buy, sell, and hold bitcoin, MasterCard will allow its users to reap digital currency rewards, exchange their existing reward points for the digital currencies that MasterCard will support through its custodian Bakkt, and will let users obtain digital currency debit and credit cards.
“We’re incredibly excited to partner with Mastercard to bring crypto loyalty services to millions of consumers,” said Nancy Gordon, EVP, Loyalty Rewards & Payments at Bakkt.
“As brands and merchants look to appeal to younger consumers and their transaction preferences, these new offerings represent a unique opportunity to satisfy increasing demand for crypto, payment and rewards flexibility.”
Preparing for the future
MasterCard’s partnership with Bakkt shows that the blockchain and digital asset industry has become too large for banking, finance, and payments giants to ignore. Many of the major players in these industries are adding support for digital currency-related products because there is a strong demand for them, especially in younger generations.
According to the Bakkt U.S. Consumer Crypto Survey of 2,000 U.S. Consumers, 48% of respondents reported purchasing bitcoin in the first half of 2021; and according to the Mastercard New Payments Index, 77% of millennials stated that they are interested in learning more about digital currency, with 75% saying that they would use digital currency if they understood it better.
If MasterCard did not make the move to offer digital currency-related products, then they would lose business because a portion of their users would flock to MasterCard competitors that do support digital currency. We will most likely see more industry incumbents offer digital currency-related products in the far and near future. This trend is likely to continue as blockchain technologies and digital assets become increasingly popular because if companies choose not to support these emerging markets, then they’re going to lose customers.
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