Mastercard has announced the launch of a new service called Mastercard Crypto Credential, designed to ensure verifiable and compliant transactions between users’ wallets, starting with transfers of digital assets between countries. The service uses technology from blockchain analytics platform CipherTrace, which Mastercard acquired in late 2021.
Announcing the new service at Consensus 2023, Raj Dhamodharan, Executive in charge of Crypto Products and Blockchain at Mastercard, explained that the first cross-border use case will allow wallets to be identified in transactions that are compliant with requirements such as the Financial Action Task Force’s “travel rule.” Dhamodharan said that compliance and verification for cross-border transactions are complex, and the service will help to identify wallets and exchange information about the other party.
To roll out the service, Mastercard has collaborated with Bit2Me, Lirium, Mercado Bitcoin, and Uphold, all wallet providers working on an initial project to enable transfers between the US and Latin America and the Caribbean corridors. More use cases for the service, such as non-fungible token (NFT) transactions, will follow, Dhamodharan added.
The travel rule requires that whenever crypto worth over $1,000 is transacted between two parties, the crypto service provider of the sender is expected to communicate the personally identifiable information of the sender to the crypto service provider of the recipient, and vice versa. CipherTrace, the creator of a cryptocurrency system that helps companies comply with the travel rule, has been focusing on cross-border transactions.
Mastercard’s new service will help to ensure that cross-border transactions comply with regulatory requirements, providing a safer and more secure environment for users’ wallets.