Mastercard, the global payment giant, is set to terminate its partnership with Binance, the world’s largest cryptocurrency exchange, for crypto card services. According to a report from Bloomberg on Thursday, the four-year collaboration that provided services to Binance users in Argentina, Brazil, Columbia, and Bahrain will conclude on September 22.
A MasterCard spokesperson confirmed this development via email. The conclusion of this partnership will exclusively impact the Binance services and will not affect Mastercard’s other crypto card programs. Users with Binance wallets will have the opportunity during the wind-down period to convert their holdings.
While the exact cause for this decision was not explicitly stated in the Bloomberg report, it indicated that increased regulatory scrutiny faced by Binance could be a contributing factor.
It’s worth noting that Mastercard isn’t the sole entity distancing itself from Binance amidst its global regulatory challenges. Visa, in Europe, also ceased issuing new co-branded cards with Binance in July, as reportedly stated by Binance.
The Binance-MasterCard Crypto Card
The Mastercard-Binance crypto card allowed users to make payments in local fiat currencies, utilizing their cryptocurrency holdings on the Binance exchange. This partnership cessation arrived around a year after both entities introduced a prepaid card for residents of Argentina. Subsequently, in the early months of 2023, the collaboration extended to Latin America.
Unfortunately, this partnership is concluding due to renewed regulatory problems faced by Binance across the world. A representative from Mastercard reassured that the termination of the partnership will not impact other crypto card initiatives by Mastercard. The company’s official website still lists partnerships with other crypto exchanges, such as Gemini.
Challenges with Binance
Binance has been grappling with issues as well. Recently, the exchange revealed its decision to shut down Binance Connect, its regulated buy-and-sell crypto division. This move was attributed to a routine evaluation of Binance’s products and services. Binance Connect facilitated crypto payments for merchants.
Additionally, the exchange’s customer support team announced the discontinuation of its crypto-backed debit card service in Latin America and the Middle East.
Binance has faced a challenging year, marked by legal and regulatory disputes. In June, US regulators filed a lawsuit against the exchange and its CEO, Changpeng Zhao, alleging deceptive operations. The US Commodity Futures Trading Commission also took legal action against Binance for inadequate registration compliance.
Furthermore, the United States Department of Justice is investigating Binance for allegedly allowing Russian individuals to use the platform in violation of US sanctions.
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