Mastercard to support few cryptocurrencies on its network

The American financial services company Mastercard has revealed its plans to offer support for some cryptocurrencies on its network this year, joining a group of large firms that have pledged similar support.

The credit-card giant’s announcement comes days after Elon Musk’s electric car and battery maker Tesla revealed it had purchased $1.5 billion of bitcoin, a popular cryptocurrency, and would soon accept it as a form of payment. Asset manager BlackRock and payments companies Square and PayPal have also recently backed cryptocurrencies.

Mastercard already offers its customers cards that allow people to transact using their cryptocurrencies, although without going through its network.

“Doing this work will create a lot more possibilities for shoppers and merchants, allowing them to transact in an entirely new form of payment. This change may open merchants up to new customers who are already flocking to digital assets,” Mastercard said.

Mastercard specified that not all cryptocurrencies will be supported on its network, adding that many of the hundreds of digital assets in circulation still need to tighten their compliance measures.

Skepticisms

Many cryptocurrencies have struggled to win the trust of mainstream investors and the general public due to their speculative nature and potential for money laundering.

For instance, Sharmin Mossavar-Rahmani who is the head of the investment strategy group of the bank of Goldman Sachs Group, the American multinational investment bank and financial services company said that, “Something with a long-term volatility of 80 percent can’t be considered a medium of exchange. Just because everybody piles into an idea and talks it up doesn’t mean it’s a store of value.”

Ms. Rahmani’s skepticism about Bitcoin’s value is similar to that of European Central Bank governing council member Gabriel Makhlouf, who said last month Bitcoin investors should be prepared to “lose all their money.”

Moreover, policymakers across the European Union (EU) and from various parts of the world have come forward with the demand for uniform laws to regulate the transactions and usage of cryptocurrencies given its high potential to be used in a negative way.