MasterCard is Open to Using Central Bank Issues Cryptocurrencies

Ari Sarker, the co-president of MasterCard’s Asia Pacific business said that the financial service is ‘very happy to look at’ the use of cryptocurrencies, but they need to be issued by central banks. Here is what the senior executive at MasterCard said to the Financial Times:

“If governments look to create national digital currency we’d be very happy to look at those in a more favorable way [compared with existing cryptocurrencies]. So long as it’s backed by a regulator and the value . . . it is not anonymous; it is meeting all the regulatory requirements, I think that would be of greater interest for us to explore.”

Just last month, both MasterCard and Visa cardholders found it difficult to buy cryptocurrencies such as bitcoins. Both the issuers reclassified digital currency transactions on popular trading platforms like Coinbase as “cash advances” rather than “purchases.” This meant that using a credit card to make a crypto transaction will result in 5% fees along with 4% fees already charged by Coinbase.

The current initiative from MasterCard to let their customers cash out on bitcoins seems like a pilot test. Sarkar clarified the situation by emphasizing that this doesn’t mean that the company is currently allowing bitcoin trading through its network, but instead MasterCard merely is “dipping its toes in the water.” The pilot isn’t even of scale as of yet and is only running in Singapore and Japan.

Now it should be noted that there aren’t any cryptocurrency coins issued by any central bank. Although there have been talks about the Bank of England and the Bank of Canada issuing something similar, they haven’t progressed with the notion as of yet.

However, if we do want to look for progression and hope for a government back digital currency, then we may have to turn our eyes to Russia. The Russian Association of Cryptocurrency and Blockchain (RACIB) announced back in January that they were to introduce CryptoRuble (previously known as Bitruble) by July 2019, a state-issued cryptocurrency.  

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