In what could turn out to be a shot in the arm for the crypto industry, pro-crypto payments firm Mastercard has partnered with crypto trading platform Paxos to help banks and fintech firms offer crypto trading to their customers.
Mastercard’s new program will make it easier for banks and financial institutions to offer secure crypto trading services to their customers. Dubbed Crypto Source, the program will act as the connecting link between Paxos and banks. Mastercard will oversee the compliance and security aspects of crypto trading, which have deterred banks from offering crypto-related services to clients. Paxos will take care of custody and trading services. Thanks to the partnership, crypto services will be made available on banks’ interfaces.
Banks and traditional financial institutions have largely stayed away from offering crypto trading services to retail investors though large players such as JP Morgan and Goldman Sachs plan to service institutional investors. The new tie-up is expected to give banks and fintechs a toehold in the lucrative space.
According to the press release, Mastercard is currently offering manifold crypto-related services for banks and fintechs. This includes technology and partnership support for crypto investments, along with security management which encompasses Mastercard’s identity solutions, crypto analytics, transaction monitoring, anti-money laundering, and cybersecurity.
Mastercard also offers crypto spend and cash out functions through products like crypto cards, open banking, and cross border services. The new Crypto Source program includes program design, product development and technology implementation. Additionally, it will also provide market optimization along with marketing consultancy services, end-to-end support for banks, fintechs, and issuers to offer crypto programs at scale.
“Our commitment is simple – to explore crypto and the underlying digital assets technology to support consumer choice in payments. Today is an exciting step in our crypto journey that draws on the strengths of our global businesses, from open banking and identity verification to analytics and fraud monitoring to settlement solutions,” said Jorn Lambert, Chief Digital Officer at Mastercard.
