Mastercard will utilize the Mastercard Crypto Credentials in the launch of its MTN.
Payment processing corporation Mastercard Inc (NYSE: MA) is testing tokenized bank deposits as it plans to release a Multi-Token Network (MTN). Mastercard recently announced its latest development, noting that MTN will first be available in beta mode. The testbed will kickstart this summer in the UK. Ahead of the financial service provider, multiple pilots and projects involved tokenized cash and related applications. Some years ago, JPMorgan (NYSE: JPM) hit the headlines with its plan for an in-house digital token. The bank launched JPM in 2019 and it is currently available to its institutional clients.
Digital asset and blockchain technologies will one day become critical infrastructure for storing and moving value. The Mastercard Multi-Token Network will make transactions within this ecosystem secure, scalable and interoperable. https://t.co/Vb1JtnSTjx#digital #blockchain… pic.twitter.com/YlH8rHgQQI
— Mastercard News (@MastercardNews) June 28, 2023
Mastercard Sets Up Testbed Dubbed MTN
Mastercard has announced MTN, which will begin by exploring tokenized bank deposits. According to the company’s head of crypto and blockchain, Raj Dhamodharan, the initiative will evolve into experiments with stablecoins and central bank digital currencies (CBDCs). Raj revealed that Mastercard had invited some financial institutions and banks to participate in the testbed.
Speaking to CoinDesk in an interview, the Mastercard executive said about the unveiling of MTN:
“So we’re starting with making tokenized bank deposits, so the unit of money in a bank account is a digital asset on the blockchain, bringing the same level of programmability to those as you find with digital currency in the crypto ecosystem.”
Mastercard’s intended first types of applications and use cases concerning tokenized bank deposits fit perfectly with its Mastercard Crypto Credentials. The service was launched in April 2023 to ensure cross-border transactions between wallets are verifiable and compliant. The Mastercard Credential Service allows wallets to be identified in transactions compliant with requirements like the Financial Task Force’s travel rule and the anti-money laundering (AML) regulations. Mastercard teamed up with wallet providers to roll out the service. The wallet providers are Uphold, Lirium, Bit2Me, and Mercado Bitcoin.
Now, Mastercard will utilize the Mastercard Crypto Credentials in the launch of its MTN. Raj spoke further:
“Let’s say a bank in the UK has this tokenized form of bank deposit; and let’s say another bank in Singapore also has a tokenized form of deposits. You can see this being exchanged one for the other, also known as cross border transfer of value, which traditionally had a lot of issues in terms of being able to move in a fast and flexible way.”
Mastercard’s Continuous Growth
Over time, Mastercard has been consistently building and expanding its operations across the world. The company partnered with Australian fintech Stables in March to enable stablecoin payment in the APAC region. Under the partnership, users of the Stables platform can pay for goods and services with the USD Coin (USDC) in places that accept Mastercard.
Currently, Mastercard stock is up 0.33% to $381.50 after growing by almost 18% over the past year.
next