Mastercard makes it easy to claim bitcoin rewards using your credit card
Cryptocurrency was first created as an alternative to traditional financial institutions. Today, it has become mainstream enough that the more than 50-year-old credit card company Mastercard offers its customers access to digital wallets in cryptocurrency, debit and credit cards with the cryptocurrency brand, and even cryptocurrency -based loyalty reward programs. These tools are part of the Mastercard partnership Office has partnered on Monday with Bakkt, a platform for buying and selling digital assets such as crypto.
Banks and financial institutions offering Mastercard credit and debit cards will now enable customers to pay their balance and earn loyalty points with bitcoin, the cryptocurrency supported by the Bakkt platform. as about the Mastercard agreement with Bakkt, merchants including restaurants and retailers will be able to offer bitcoin as an alternative to the traditional loyalty points typically offered by credit card users. At the same time, these Mastercard customers have the option to convert the reward points they already have into bitcoin and store them in a Bakkt digital wallet.
This will give holders of more than 2.8 billion Mastercard in circulation a potential on-ramp in the world of crypto investing. While people who choose to convert or accumulate crypto reward points will still be at risk because the value of the cryptocurrency is usually determined by fast crypto market, Mastercard offers will make taking that risk much easier and less daunting than having to sign up separately for a crypto platform.
This isn’t Mastercard’s first cryptocurrency search. There are many Mastercard credit and debit cards for people who want to use cryptocurrency. Mastercard debit and prepaid cards offered by the platforms STAND and BitPay allow people to easily convert their cryptocurrency assets to traditional money, while a Mastercard credit card is offered by the crypto company Gemini allows customers to earn cryptocurrency rewards based on their spending activity.
In September, Mastercard too done the first of these non-fungible tokens, or NFT, (an animated ball signed by soccer coach José Mourinho) as part of a credit card loyalty sweepstakes. Now, Mastercard’s decision to integrate support for bitcoin across its entire payment network means many people will not only be exposed to the cryptocurrency, but be rewarded with it. Mastercard said this latest expansion will affect more than 20,000 financial institutions, including banks and credit unions, that work with the company.
More information about when these new capabilities will be available to customers will be shared at a later date, according to Mastercard.
“As brands and entrepreneurs look to appeal to young consumers and their transactional preferences, these new offerings represent a unique opportunity to satisfy a growing market. need for flexibility in crypto, payments, and rewards, ”Nancy Gordon, vice president of rewards and payments at Bakkt, said in a statement.
The announcement comes as credit card companies are slowly releasing some of their concerns about cryptocurrency and looking for ways to capitalize on its growing popularity. In the first half of 2021, Visa customers spent more than $ 1 billion on cryptocurrency with credit cards offered by the company through a partnership with three different crypto platforms: Circle, BlockFi, and Coinbase. Some credit companies are signaling that they may start offering cryptocurrencies as well soon. Late last year, American Express investments failed the cryptocurrency trading platform called FalconX; at the same time, Discover Financial, which operates Discover Card, began hiring and staff to also build cryptocurrency capabilities.
Credit card companies are just one example of traditional financial institutions creating plenty of space for regular people to get and use crypto. In April, Coinbase — a platform for buying and selling cryptocurrencies — became the first crypto company to go public – which effectively allows people to invest in cryptocurrency without having to buy any particular coin. Bakkt, the platform that works with Mastercard, also published earlier this month. And last week, the first cryptocurrency-linked exchange-traded fund, or ETF, which is a basket of securities tied to the future price of bitcoin, started trading. Payment platforms such as Paypal, Venmo (owned by Paypal), and Square all support cryptocurrency-based transactions, and Square even thought building a bitcoin mining business, which is a way to use a lot of computing power to create new bitcoins.
Another sign that cryptocurrency is here to stay: growing investment in new fraud and security technology to track cryptocurrency-based credit card scams and crimes. Unlike traditional currency, digital assets such as bitcoin are not controlled or regulated by any government, and their cryptography makes it difficult to track and modify cryptocurrency-based transactions. As a result, crypto is vulnerable to theft and adopted by money-launderers. Just days before the cryptocurrency expansion was announced, Mastercard bought CipherTrace, a cryptocurrency firm supported by the Department of Homeland Security announcing itself as “the world’s first blockchain forensics team.” Paypal also intends to hire cryptocurrency experts to focus security issues such as money laundering and counter-terrorism.
Cryptocurrency has become so popular, among criminals, that the U.S. Marshals Service, the branch of government that handles the seized assets, hires cryptocurrency bank to keep all seized cryptocurrency it holds after criminal investigations. The developments are a reminder that while credit card companies are trying to make these digital assets more popular with traditional credit card holders, cryptocurrency carries risks.
However, most cryptocurrency holders don’t seem to be complaining that some of the most popular financial services are slowly becoming more crypto -friendly. After all, it’s hard to ignore that the growing effort to mainstream cryptocurrency has a convenient effect on raising the value of cryptocurrency investments they already have.