According to the licence, users will be able to store in banks fiat currencies and cryptocurrencies under one profile, which inches crypto credit cards closer to being widely used for the purchase of goods.
Mastercard says that customers are increasingly inclined to use cryptocurrencies over fiat money due to anonymity and in an effort to prevent fraud against them.
The US-based payments firm explained the new patented system would still rely on existing fraud and risk algorithms to assess the legitimacy of crypto transactions. It will also allow digital assets access to credit bureau information, historical transaction data and demographics.
Mastercard sees a few problems with cryptocurrencies, such as “little protection to receivers of funds” as well as the fact that verification of transactions currently takes up to 10 minutes. However, it believes that combining systems already in place for fiat with crypto could potentially bolster adoption and still have the benefits of decentralisation.
“We’re consistently looking at ways to bring new thinking and new innovations to market to create value for us and our customers and cardholders,” says Mastercard Senior Vice President for Communications Seth Eisen. “Patent applications are part of that process, taking steps to protect the company’s intellectual property, whether or not the idea ever comes to market.”
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.