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Mastercard preparing for CBDCs

Mastercard is preparing its infrastructure for the deployment of CBDCs

The world’s third-largest consumer payment processor remains bullish on the adoption of CBDCs.

Image courtesy of CoinTelegraph

            OCTOBER 01, 2021

During an earnings call with investors and stakeholders, Michael Miebach, CEO of Mastercard, discussed his positive outlook on the cryptocurrency industry. The company has not only seen sizable volume growth in consumers using their Mastercards to purchase crypto but has also secured several partnerships with cryptocurrency firms. But Miebach’s most ambitious viewpoint emerged during a discussion regarding central bank digital currencies, or CBDCs, saying:

“We are saying at this point in time, the 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.”

Miebach remained confident on Mastercard’s role in the matter, stating “We can provide a safe space for government and private sector banks to figure out how that will actually work.”

Talk of CBDCs has continued to rapidly gain traction over the past year. On Oct.21, the Bahamas became the first country in the world to issue a CBDC — known as the “Sand Dollar”. Just a few days later, Nigerian President Muhammadu Buhari announced plans to unveil its own eNaira CBDC in the country.

According to Statistica, Mastercard processed 113 billion transactions across the globe last year — just behind Visa’s 188 billion and Union Pay’s 151 billion.

The world’s third-largest payment processor has taken a keen interest in the cryptocurrency space in recent months. On Monday, Mastercard announced it would partner with cryptocurrency marketplace Bakkt to enable its U.S. customers to trade digital currencies. In September, the company declared that it would acquire blockchain analytics firm CipherTrace to track illicit transactions across 900 different cryptocurrencies. However, CEO Miebach has taken a more risk-averse approach to the industry as a whole, as stated in the company’s third-quarter earnings call:

“Questions like the last mile — how do you bring utility into the hands of your citizens if you put out a CBDC. Acceptance questions and so forth. So, facilitating investments as an asset class, we do that, and we get ready for CBDCs. Should there be a private sector stablecoin? We might also do that. But we have very strict principles on when to do this and when not.”

Original article posted on the CoinTelegraph.com site, by Zhiyuan Sun.

Article re-posted on Markethive by Jeffrey Sloe

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