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Payments giant Mastercard is betting big on a CBDC future and says that all its patents in the cryptocurrency space put the company in a leading position to embrace the next wave of technology.
As central banks across the globe gear up for launching their own CBDC, payment giants search for new business opportunities. During its Q3 2020 earnings call Mastercard President Michael Miebach said that all of its crypto patents will pay off as CBDC projects start entering the global markets.
Referring to its crypto patents as intellectual property Miebach says that the company is “in a good position” for a CBDC future. He further added:
“The link into an acceptance network is critical. So we hold some patents in [the crypto] space that link these transactions right back into our network where it can be used. And this is how we can bring value, and it brings value to us.”
Looking at the recent developments in the crypto space, Mastercard has been smartly consolidating its positions. Currently, it is one of the “leading payments players” for digital currency IP. However, Mastercard is facing strong competition from some of its Chinese counterparts.
Mastercard CBDC Testing Platform
The company has put new efforts into up its game in the CBDC market. Nearly 70% of the global central banks have started testing their CBDCs in the market. Even global institutions like the IMF, the BIS, World Banks, and others have been much vocal about it.
Two months back, Mastercard introduced its new blockchain platform to test CBDCs. The platform allows central banks to simulate different use-cases for CBDCs and also test them for practical use. Besides, it also has simulations for roll-out strategies in the market. Raj Dhamodharan, Executive Vice President, Digital Asset and Blockchain Products and Partnerships, Mastercard, said:
“Central banks have accelerated their exploration of digital currencies with a variety of objectives, from fostering financial inclusion to modernizing the payments ecosystem. Mastercard is driving innovation with the public sector, banks, fintechs, and advisory firms in the exploration of CBDCs. This new platform supports central banks as they make decisions now and in the future about the path forward for local and regional economies.”
In addition to central banks, Mastercard has also asked other financial advisory firms and tech firms for CBDC designs. Mastercard wants to ensure that the platform is interoperable with the existing payment infrastructure used by consumers and businesses today.