Mastercard ready for CBDCs and the future of money

Mastercard is in the process of building payment infrastructure for the next step in crypto, Central Bank Digital Currencies (CBDC).

Speaking to investors and shareholders Michael Miebach, the CEO of Mastercard, highlighted the already burgeoning growth in crypto transaction volume among customers.

However, Miebach sees the potential for digital tokens in everyday purchases through the incoming CBDCs. In the meeting he said “he most likely chance for this kind of technology to work for payments is if it’s issued through a government in the form of a CBDC.

We said that on a couple of calls before, and we said that we will make our network ready to do that as and when a government is ready to put out a CBDC that will exist alongside the dollar or the euro as a settlement currency in our network.”

This has come following a concerted push by Mastercard to improve customer access to crypto assets. In September, the company announced a testing platform for governments to help speed up the introduction of CBDCs.

Miebach touted this platform in the meeting, saying that “we can provide a safe space for government and private sector banks to figure out how that will actually work”.

Since then, they have partnered with the digital asset platform Bakkt. The partnership will offer crypto-based loyalty rewards and allow customers to buy and sell crypto.

The increased access to crypto for Mastercard customers is likely to increase crypto transactions. Mastercard had the third most transactions globally in 2020, behind only Union Pay and Visa.