Credit giant Mastercard wants to work with blockchain and crypto companies on its central bank digital currency (CBDC) program. The firm has touted the benefits of state-controlled programmable money and wants to expand its partner program.
In an Aug. 17 blog post titled “Is safe the new sexy? CBDCs, trust and the evolution of money,” Mastercard has called for crypto collaboration.
Mastercard Bets Big on Central Bank Digital Currencies
The firm noted that CBDCs were gaining momentum, reporting that 93% of central banks are engaged in CBDC work, with four already in circulation.
However, it said key questions remain around CBDC roles, security, privacy, and integration with existing systems.
Mastercard has launched its CBDC Partner Program to foster collaboration on blockchain-based money. Its initial partners include Ripple, ConsenSys, Fluency, Idemia, Consult Hyperion, Giesecke+Devrient, and Fireblocks.
Furthermore, the credit giant wants more crypto companies to become partners in the initiative. The note indicated that partners are actively defining CBDC requirements, ensuring privacy, enabling offline use, and building interoperability.
“Mastercard is convening a group of leading blockchain technology and payment service providers to join its new CBDC partner program.”
Moreover, Jesse McWaters, who leads global regulatory advocacy at Mastercard, said CBDCs shouldn’t be adopted in a vacuum.
“The work of the Mastercard CBDC Partner Program will help central banks understand how to develop a CBDC that adds something new and valuable to the economy,” he added.
Fireblocks’ Varun Paul cautioned that hesitancy may have increased in the wake of last year’s “crypto winter.” Multiple scandals threatened the trust that the digital ecosystem needs to evolve and thrive, he added.
“Recent high-profile collapses actually strengthen the case for CBDCs, which are fully backed by a central bank and government.”
According to the Atlantic Council’s CBDC tracker, 130 countries, representing 98% of global GDP, are exploring a CBDC.
Furthermore, eleven countries have launched a CBDC, all of which are in the Caribbean, aside from Nigeria. Moreover, there are 21 countries currently piloting a CBDC, and most of them are in the Middle East and Asia.
However, as concerns over privacy and state control over financial freedom mount, not everyone is convinced that CBDCs are a viable solution.
Earlier this year, US Congressman Tom Emmer unveiled the CBDC Anti-Surveillance Act. Additionally, the bill aims to “halt efforts of unelected bureaucrats in Washington from stripping Americans of their right to financial privacy.”
In July, Republican Representative Warren Davidson called for a halt in CBDC development, arguing that “Money should not be programmable by a central authority.”
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