Visa and Mastercard discontinued their new crypto partnerships
Due to certain arising issues with crypto regulation, the two payment giants, Mastercard and Visa discontinued their crypto partnerships for the time being.
Not long ago the news came along about Mastercard planning to settle payments in USD coins where as Visa card was up for processing payments in stablecoins. These warming partnerships jolted the crypto community by surprise, which eventually led to an abrupt increase in the popularity of cryptocurrencies.
However, Reuters reported on 28 Feb that the tightened regulatory framework because of the high-profile bankruptcies in the industry is the reason, the major American payment processors Visa and Mastercard decided to temporarily hold the partnerships with the crypto firms.
Furthermore, according to Visa and Mastercard, there is still a long way for crypto until it becomes a true component of mainstream payments. Hence, they had to shove aside the launch of various crypto-related products and services.
The poor or insufficient crypto regulatory framework is most probably why Visa and MasterCard discontinued their new crypto partnerships. thus poor regulatory framework caused bankruptcies and made digital asset holders such as FTX, Celsius, Voyager Digital, Three Arrows Capital, and others crumble down within the past year, according to reports.
A spokesperson from Visa stated:
“Recent high-profile failures in the crypto sector are an important reminder that we have a long way to go before crypto becomes a part of mainstream payments and financial services.”
Cuy Sheffield, the Head of product at Visa called the reports by Reuter incorrect, he said that Visa, “continue to partner with crypto companies to improve fiat on and off ramps as well as progress on our product roadmap to build new products that can facilitate stablecoin payments in a secure, compliant, and convenient way.”
“Despite the challenges and uncertainty in the crypto ecosystem, our view has not changed that fiat backed digital currencies running on public blockchains have the potential to play an important role in the payments ecosystem.”
Earlier, the Binane cryptocurrency exchange, which has been involved in some regulatory disputes lately, partnered with Mastercard and Visa. Binance Visa launched a Binance’s cryptocurrency Visa debit card for European residents with initial cashback, available in the European economic area. Mastercard with Binance established a similar idea to unveil a prepaid crypto debit card for Brazilian users.
Moreover on Feb 13 Paxos – the blockchain infrastructure company – decided to end the partnership with Binance after they issued their stablecoin Binance USD. In addition, On February 8th, Binance suspended U.S. dollar deposits and withdrawals via Society for Worldwide Interbank Financial Telecommunications (SWIFT) channels temporarily. The reason cited was that Binance’s banking partner, Signature Bank, decided to reduce its exposure to cryptocurrency.