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Central Banks

MasterCard launches digital currency platform for Central Banks

  • MasterCard’s new virtual environment offers opportunities to central banks worldwide to test digital currencies
  • China are current leaders of the central bank digital assets race with their Digital Yuan
  • MasterCard withdrew membership from Facebook’s Libra Association in October 2019 after disputes about regulatory and business model procedures

MasterCard Platform

MasterCard have publicly released their testing platform, opening up the opportunity of partnership invitations to central and commercial banks, tech and advisory firms to “assess CBDC tech designs, validate use cases and evaluate interoperability with existing payment rails available for consumers and businesses today.

After dropping of our Facebook’s Libra association in October 2019 along with fellow payment provider Visa, it was unsure what the companies next move was in the digital finance space.

With this announcement, the US owned company have assured their intent in the central bank race to global-scale adoption of digital assets. However, even with their global brand presence and multi-million strong customer base, competition will still be strong.

Central Banks Going Digital

Most notably, their countries prominent ecopolitical rivals China who have made progressive leaps and bounds in the development of the Digital Yuan over the past few years and will certainly be the first major economy to become active in the space.

The Bank of England have also opened discussions surrounding the implementation of digital currency in the future. Though, a severe economic recession because of the C19 pandemic may put plans on hold for now.

Comments

Executive Vice President of Digital Asset at Mastercard, Raj Dhamodharan commented on the platform:

Central banks have accelerated their exploration of digital currencies with a variety of objectives, from fostering financial inclusion to modernising the payments ecosystem.

Mastercard is driving innovation with the public sector, banks, fintechs, and advisory firms in the exploration of CBDCs, working with partners that are aligned to our core values and principles. This new platform supports central banks as they make decisions now and in the future about the path forward for local and regional economies.

MasterCard have already stated they are working with multiple central banks on the platform and with this invitational announcement, are expecting more to follow.

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