Mastercard has launched a crypto-to-fiat card with Web3/blockchain platform MetaMask and cryptocurrency payments firm Baanx.
The MetaMask Card, announced Wednesday (Aug. 14), lets MetaMask wallet customers use crypto for everyday purchases in fiat currency wherever Mastercard is accepted. The card is being piloted on a limited basis — a few thousand digital-only cards — for users in European Union countries and the U.K.
“Self-custodial wallet users have faced challenges when looking to spend funds outside the crypto world,” the companies said in a news release. “Typically, they would need to transfer their crypto assets to an exchange, convert them to fiat, and then move those funds to a traditional bank account to then spend. This process has been a roadblock to making crypto more mainstream as a method of value exchange.”
The new offering is part of a Mastercard program aimed at connecting Web2 and Web3 ecosystems, and functions like a traditional debit card: users can make purchases directly from their MetaMask wallet, while keeping custody of their funds until the moment of the transaction.
Crypto is then instantly turned to fiat and available to make purchases online or in-store. Users must hold their crypto on-chain on the Linea network and use MetaMask to set spending caps for the card, but can store their keys wherever they choose.
“We’re building toward this vision of enabling non-custodial neobanking,” said Simon Jones, chief commercial officer at Baanx. “Anybody who has access to a mobile phone should be able to get access to a basic range of financial services by default. This would have huge implications in countries with large numbers of unbanked or underbanked individuals.”
In other crypto news, PYMNTS wrote earlier this week about the challenges facing the sector in the wake of recent action by federal authorities.
In this case, it was the Pennsylvania-based Customers Bank, one of the few crypto-friendly banks in the U.S., getting served with a 13-page regulatory enforcement action by the Federal Reserve connected to the lender’s digital asset and dollar token activities.
Despite these roadblocks, research by PYMNTS Intelligence has shown that using cryptocurrencies for cross-border payments could be the winning use case that the sector has been searching for. That data found that blockchain-based cross-border solutions, especially stablecoins, are being increasingly embraced by firms looking to find a better way to transact and expand internationally.
“Separate PYMNTS Intelligence also found that blockchain has numerous potential benefits to serve the unique needs of regulated industries, including finance, healthcare, identity verification and supply chain management,” that report said.
