Visa and Mastercard, two of the world’s largest payment companies, have halted their plans to partner with crypto firms following the string of high-profile collapses that have rocked the industry and increased regulatory scrutiny.
The companies have decided to delay launching certain crypto-related products and services until the market conditions and regulatory environment improve. The crypto industry witnessed a stunning reversal of fortunes in 2022 as the bankruptcies of industry majors FTX and BlockFi rattled investors.
Visa and Mastercard Delay Crypto Partnership Plans
In recent years, Visa and Mastercard had warmed up to crypto as the popularity of the asset class exploded, with some touting it as the next big thing in finance. They had announced multiple partnerships with crypto firms and put in place dedicated teams to explore blockchain technology.
Still, recent events have caused Visa and Mastercard to retreat from the industry and wait for a clear regulatory framework.
“Recent high-profile failures in the crypto sector are an important reminder that we have a long way to go before crypto becomes a part of mainstream payments and financial services,” said a spokesperson for Visa. “Our efforts continue to focus on the underlying blockchain technology and how that can be applied to help address current pain points and build more efficient systems,” said a spokesperson for Mastercard.
Card company American Express said that it would consider using cryptocurrencies as a possible option to redeem reward points in the future but does not view digital assets as a strategic priority in the near term. An AmEx spokesperson said that the company continues to explore meaningful use cases for the technology but that delays are attributable to the uncertain regulatory environment for crypto and the declining demand/interest for crypto services in the near term.
Thomas Hayes, chairman and managing member at investment firm Great Hill Capital, commented:
“They cannot and should not move ahead until there is a clear regulatory framework. Delays are not attributable to their core business – as that remains strong. They are related to an uncertain regulatory environment for crypto and demand/interest for crypto services declining in the near term.”
Disclaimer
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.
Source: https://beincrypto.com/visa-mastercard-pause-crypto-plans/