Credit card giant Mastercard announced a partnership Monday morning that will enable its network of partners—including banks and merchants—to offer cryptocurrency credit card rewards and products, expanding access to digital assets as ongoing institutional adoption helps lift the crypto market to meteoric new highs.
Shares of the digital wallet company tapped for the move skyrocketed more than 80% after the … [+] announcement.SOPA Images/LightRocket via Getty Images
In a Monday statement, Mastercard said it has tapped Georgia-based digital wallet company Bakkt to begin offering cryptocurrency products and services to its partners in the United States.
As a result of the partnership, companies will be able to offer cryptocurrency as rewards for transactions, in lieu of traditional loyalty points, and customers will be able to spend their crypto holdings to pay for purchases, Mastercard said.
Banks will also be able to issue cryptocurrency debit and credit cards, similar to the crypto-linked cards already offered by Visa.
Though Mastercard stock ticked up just 0.4% following the announcement, shares of Bakkt, which debuted on the New York Stock Exchange last week, skyrocketed more than 86% Monday morning, lifting the three-year-old company’s market capitalization to about $850 million.
Mastercard’s new crypto offerings add to the firm’s growing investment in the nascent digital asset space. Just last month, the company acquired Silicon Valley-based crypto-analytics firm Ciphertrace for an undisclosed price, saying in a statement that “digital assets have the potential to reimagine commerce.” Mastercard has previously partnered with fintech company Uphold and crypto exchange Gemini to create crypto credit cards, and it’s also developed platforms to help governments test central bank digital currencies. On Monday, Mastercard pointed out that 77% of Millennials said they are interested in learning more about cryptocurrencies, with about 75% saying they would use crypto more if they understood it better.
Nearly tripling in the past year alone, the cryptocurrency market has catapulted to a value of $2.7 trillion thanks in part to growing adoption from legacy financial institutions. Last week, the launch of the first bitcoin-linked exchange-traded fund in the United States helped bitcoin prices surge nearly 20% to an all-time high of roughly $67,000.
Bitcoin ETF Rises 4.7% In First Day Of Trading As Bitcoin Prices Approach All-Time Highs (Forbes)