The big moment of Bitcoin: Mastercard jumps on the bandwagon

by

The company announced Wednesday afternoon that it will support “selecting cryptocurrencies” directly on its network sometime later this year.

“Our philosophy on cryptocurrencies is simple: it’s about choice,” Raj Dhamodharan, executive vice president of Mastercard, wrote in a post last Wednesday. “Mastercard is not here to recommend that you start using cryptocurrencies. But we are here to allow customers, merchants and businesses to move digital value (traditional or cryptocurrency) as they wish.”

While Mastercard lacked details on how customers will be able to use Bitcoin, the company said it would work like this: When someone wants to buy an item with cryptocurrency, Mastercard’s cryptocurrency partners will convert the digital currency into traditional currency and then transmit it to the Mastercard network.

This change “will allow many more merchants to accept cryptography,” as well as “eliminate inefficiencies, leaving both consumers and merchants to have to switch back and forth between cryptography and traditional to make purchases,” Mastercard said.

It is an important milestone for Bitcoin, which has gradually been permeating Corporate America after years of skepticism.
On Monday, Bitcoin soared to a record high above $ 44,800 later Tesla (TSLA) he said he would soon accept bitcoin as payment for his vehicles and revealed he had bought $ 1.5 billion in bitcoin as part of his cash stakes. Digital payment giants Square (SQ) i PayPal (PYPL) recently began allowing users to trade bitcoins.

But Mastercard will be Bitcoin’s main and most important platform to date.

And Wednesday ‘s news fueled the recent rally of bitcoin (XBT), sending it 3% to trading early Thursday, reaching a record high earlier in the day. Bitcoin gained about 300% last year.

Mastercard customers are already using their cards “to buy cryptocurrency assets, especially during the recent rise in Bitcoin’s value,” the company said in a statement. The company said not all cryptocurrencies will be included and while it did not specify that Bitcoin was one of the accepted ones, it was the only Mastercard currency cited by its name.

“We are also seeing users increasingly take advantage of cryptocurrencies to access these assets and turn them into traditional currencies to spend,” Mastercard added.

Meanwhile, BNY Mellon, the oldest bank in the United States, whose history dates back to the founding of Alexander Hamilton by the Bank of New York in 1784, announced Thursday that it had formed a digital asset unit that would help customers meet the needs related to the growth of digital assets, including cryptocurrencies, at an unspecified time later this year.

Customer demand and clearer regulation “present us with a huge opportunity to extend our current service offerings to this emerging field,” said Roman Regelman, Mellon’s director of asset services and head of digital.

The concentration of Bitcoin is not enough to dethrone the powerful dollar
In November, Rick Rieder, director of fixed income investments at BlackRock (BLK), one of the world’s most powerful asset managers, said he could see bitcoin replace gold as an investment instrument.
But others continue to question its value. Last month Michael Hartnett, chief investment strategist at Bank of America Securities (BAC), referred to the recent rally on Bitcoin as “the mother of all bubbles.”

– Paul R. CNN Business’s Monica contributed to this report

.Source