Visa and Mastercard to delay crypto partnerships amidst uncertainties

Adeniyi Odukoya
Visa set to allow automatic payments from Ethereum wallets 
IMG: Shutterstock

Visa and Mastercard have delayed their plans to execute several partnership deals with crypto firms because of high-profile collapses that have hit the market in the last few months, Reuters reports.

.Considering the market’s uncertainty and enhanced regulatory scrutiny, two of the world’s largest payment companies have decided to slow down their plans to partner with crypto firms.

According to reports from both companies, they have decided to halt launching specific crypto-related products and services until market conditions are favourable for the partnerships they seek to establish.

Visa pledges $1 billion to expand its services across Africa for the next five years
Visa pledges $1 billion to expand its services across Africa for the next five years

Read: Would blockchain technology have prevented ‘irregularities’ in the 2023 Nigerian elections?

The companies are still interested in the proposed partnerships but would be interested in executing the deals when the cryptocurrency industry is better regulated and monitored by intelligent institutions. The collapse of high-profile crypto companies has gutted the sector’s fortune.

Major industry players have called for institutions to properly check the activities of major crypto companies so cases like the FTX debacle can be avoided. To improve this, some countries have proposed regulations to guide the approval of operations by a crypto firm under their auspices. These provisions are set in place to protect traders, who are often the hopeless victims of these unforeseen collapses.

Read: Want to earn money from NFT staking? Here are 3 projects you should check out 

Visa and Mastercard’s foray into the crypto space

Visa and Mastercard have shown genuine interest in cryptocurrency since the pandemic, because of the industry’s enormous popularity and profit during the lockdown period, Digital assets like Bitcoin and Ethereum had exploded, and analysis and analytics pointed to the crypto industry as the next big thing to watch out for.

The companies had announced numerous striking partnerships with crypto firms and had assembled dedicated teams of experts to investigate the blockchain industry. 

Mastercard Partners UNICAF to Offer 75% Int'l Scholarships to Cardholders in 12 African Countries

“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.

Read Also: Binance now accepts bank transfers in South Africa to make crypto trading easier

Card Company American Express added, as reported by BeInCrypto, 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 the delays are attributable to the uncertain regulatory environment for crypto and the declining demand for and interest in crypto services in the near term.

Read Also: Momint set to address South Africa’s electricity crisis using a blockchain-based solution

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, which remains strong. They are related to an uncertain regulatory environment for crypto and demand and interest for crypto services declining in the near term.”

South Africa's Crypto Space in Danger of Crumbling Under Severe Regulations Following Alleged $740M Bitcoin Scam
Bitcoin is the most traded cryptocurrency worldwide

Unfortunately, this is not good news for the cryptocurrency industry, seeing that the market needs a boost. It is not encouraging when an opportunity-bolstering partnership is delayed due to insecurities and uncertainties attached to an industry. Crypto investors and enthusiasts can only hope that the fortune of the market is restored so partnership deals like this won’t go down the drain because of attainable risks.

Technext Newsletter

Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!

Register for Technext Coinference 2023, the Largest blockchain and DeFi Gathering in Africa.

Technext Newsletter

Get the best of Africa’s daily tech to your inbox – first thing every morning.
Join the community now!