Why payment giants are teaming up with crypto companies?

Highlights

• Payment giants have joined the race to acquire and partner with crypto organisations to support digital assets.
• Payments giants like Visa and Mastercard already offer crypto-enabled debit and credit cards; now they are also forming alliances with crypto companies to boost customer trust and security. 
• Visa is known to have partnered with 65 crypto exchanges and platforms.

Cryptocurrencies are often in the spotlight these days. The increased institutional interest in digital assets proves that nonfungible tokens (NFTs), stablecoins and cryptocurrencies are not going away anytime soon. 

Meanwhile, traditional financial institutions have started to see the necessity for effective support of digital assets. Although payments giants like Visa and Mastercard already offer crypto-enabled debit and credit cards, now they are also forming alliances with crypto companies to boost customer trust and security when using digital currencies. 

Let’s have a glance at how major payments technology firms are adopting cryptos.

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Visa

Visa is a global payments technology firm that strives to make digital currencies accessible to governments, individuals, banks and businesses.

According to Media Reports, Visa revealed having collaborations with more than 65 crypto platforms. The payment behemoth stated that US$2.5 billion crypto-linked card usage was recorded in the Q1FY22, representing over 70% of the total payments volume recorded in FY21.  

Visa also launched its crypto consulting services – Global Crypto Advisory Practice – in December for its partners like financial institutions including banks and clients.

Visa revealed that its network of cryptocurrency wallet partners now includes BlockFi, Circle and Coinbase. More than 100 million merchants working with Visa now accept crypto as payment.

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Mastercard

According to Mastercard, its network partners will be allowed to provide their customers with a digital wallet through which they can hold, sell and purchase cryptos, and gift them with virtual currencies under the loyalty programmes. Customers would be able to spend and earn cryptocurrency instead of loyalty points as a result of the move.

Mastercard teamed up with digital assets platform provider, Bakkt Holdings Inc, to provide new crypto offerings to its consumers.

In addition, Mastercard declared last year that it had acquired CipherTrace to improves its crypto capabilities. CipherTrace is a blockchain analytics intelligence company with crypto forensic capabilities for over 900 cryptos.

PayPal

PayPal made an announcement in October last year, following which users in the United States can now trade on a few selected cryptos, including Litecoin, Bitcoin, Bitcoin Cash and Ethereum. In addition, PayPal app allows one to track cryptos, though the app will not allow money to be transferred out of the firm's digital wallet.

Users in the United Kingdom can now trade Bitcoin Cash, Litecoin and Ether via PayPal's app and website, according to the company’s announcement in August last year.

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