Robert Steinadler, a month ago
Mastercard, as well as its competitor VISA, have both been very active when it comes down to blockchain technology. These global players must adapt to new situations and payment methods to keep up with their businesses. Last Friday, Mastercard had an announcement, and the company has found some allies to build a new standard.
What is Mastercard Crypto Credential, who is working on it, and how can we all benefit from this new technology?
The developers of the Solana Foundation, Aptos Labs, Ava Labs, and Polygon are teaming up with Mastercard to work on a new standard. Crypto Credential establishes trust between consumers and businesses when conducting on-chain transactions.
One of the many features is wallets that are no longer based on complex strings but could be represented by the owner’s name or an alias. Blockchain data is about to be enriched with metadata to support the sender by checking the transaction details easier.
The even more important feature is that Crypto Credential will also use services from CipherTrace to verify transacting parties. The first to implement the new technology will be wallet providers and exchanges like Bit2Me, Mercado Bitcoin, Lirium, and Uphold. Crypto Credentials will empower them to see with whom they are dealing with.
Companies like CipherTrace track transactions on all blockchains and sell the necessary tools and data to third parties. Their service is needed to provide on-chain financial products because regulators demand that protocols check who uses them. Those checks are especially required when conducting cross-border transactions.
Crypto Credentials is a combined effort to achieve this goal and take the next step to mature decentralized finance by adding a missing identity element. Mastercard is one of many companies to work on such a solution or have this idea. Cardano is also working on blockchain-powered identity management that serves a similar purpose to Crypto Credentials and could be used in many other situations or scenarios.
Of course, one could argue that this unnecessary tracking of users, but it is essential to keep in mind that regulation will move forward. At some point it will be a requirement to have a solution to identify users and businesses on the blockchain. That being said, the regulation also has many benefits because once the DeFi sector leaves its wild west days behind, more capital can flow into the market since trust is reinforced among institutional investors.
Featured image: © Emagnetic / Shutterstock.com
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