Visa and MasterCard curtail crypto projects after FTX collapse and other industry scandals

2023: Visa and MasterCard wind down crypto projects after FTX collapse and other industry scandals

At the end of February 2023, payment systems Visa Mastercard decided to suspend projects based on - blockchain technology due to the fall in the cryptocurrency market and the outflow of capital from the industry.

The crypto industry suffered a crisis in 2022 FTX BlockFi as the bankruptcies of the biggest companies and shook investors and increased regulatory scrutiny of the sector. Visa and Mastercard decided to postpone the launch of some cryptocurrency-related products and services until market conditions and regulatory frameworks improve, Reuters reported. However, this does not change the cryptocurrency strategy and focus of the company, company representatives added.

At the end of February 2023, Visa and Mastercard payment systems decided to suspend projects based on blockchain technologies

According to Reuters, in addition to reducing investor interest in the blockchain industry, financial companies are also freezing projects due to legal uncertainty. Visa and Mastercard are waiting for legislation to take effect in the US and EU, a direction to ensure the transparency of the digital asset market and protect investors in 2023.

The main partner of Visa and Mastercard was previously the Binance exchange. She issued cashback debit crypto cards at Tether. A prepaid crypto card is similar to a cryptocurrency debit card. You can get a crypto card from a licensed issuer, for example, a cryptocurrency exchange or bank. In 2022, Binance offered a Visa Binance and Mastercard Binance card for KYC and AML verified users. Registration took no more than two minutes, after which the user could freely enjoy many advantages, for example, cashback and zero commissions.

In early 2023, cryptocurrency service provider Wirex announced a long-term agreement with international payment system Visa to expand the list of services in the Asia-Pacific and UK. While MasterCard and Web3 Immerse announced joint support for cryptocurrency payments of users in metaverse and on digital platforms.^[1]

2021

In mid-July 2021, Visa announced a partnership with more than 50 cryptocurrency companies to allow its customers to spend and convert digital currencies through a regular credit and debit card program. Such collaborations would allow people to use cryptocurrency to pay for purchases even from those sellers who would not normally accept digital assets.

Among Visa partners were FTX and Coinbase crypto exchanges. The new collaboration will allow customers to easily convert and spend digital currencies at 70 million outlets around the world where Visa cards are already accepted.

Visa announced cooperation with more than 50 cryptocurrency companies

While the number of consumers with digital assets on crypto platforms is growing rapidly, millions of merchants have no idea what to do with cryptocurrency. They don't want to update their points of sale and terminals and figure out what blockchain is. [Thanks to this program], sellers will not have to change anything, "explained Visa head of cryptocurrency Kai Sheffield. "In their respect, payment with cryptocurrency will look like any other Visa transaction."

While the scope of features offered will depend on the cryptocurrency platform, Visa is supposed to give users the ability to spend fiat money and earn cryptocurrency as a reward, similar to regular cashback services offering extra flight or hotel room fees through accumulated points.

Sheffield also explained that in the first half of 2021, Visa spent more than $1 billion on the deployment of cryptocurrency cards, but the company still has a lot of work to do in this area. Earlier, the payment company announced that it would allow USD Coin to be used to settle payment transactions on its platform and tested the payment option through the Crypto.com payment platform and Anchorage digital asset bank.^[2]

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