Mastercard said Monday it will let US merchants and banks bringcrypto products onto its network.- Mastercard's extended partnership with Bakkt will allow customers buy, sell and hold digital assets through wallets.
Mastercard will let US merchants, banks and fintech operators offer cryptocurrency services and products on its network, the payment services company said Monday.
Allowing such integration will enable consumers to buy, sell and hold digital assets through custodial wallets through Mastercard's partnership with Bakkt, a digital asset platform, according to a joint statement released Monday.
Shares of Bakkt soared as much as 94% to $17.71 before paring the rise to 78%. Mastercard shares were up 0.5% at $360.60 during the session.
The move stems from consumers seeking to use crypto assets for everyday purchases, Mastercard said. The move also lands as more financial institutions are establishing footprints within the crypto industry such as offering trading access to high-end clients and funding blockchain projects. Mastercard didn't specify which cryptocurrencies it will allow for use on its network.
Mastercard will enable its partners to offer cryptocurrency as rewards, setting up consumers who want to earn and spend rewards in cryptocurrency instead of traditional loyalty points. Customers will also be able to convert their crypto holdings to pay for purchases.
"As brands and merchants look to appeal to younger consumers and their transaction preferences, these new offerings represent a unique opportunity to satisfy increasing demand for crypto, payment and rewards flexibility," Nancy Gordon, Bakkt's executive vice president of loyalty rewards & payments, said in the joint statement.
48% of 2,000 respondents to Bakkt's US Consumer Crypto Survey said they had bought crypto in the first half of 2021, and 32% who hadn't are either very or somewhat interested in doing so before the end of the year.
The adoption of bitcoin-based products has helped drive that cryptocurrency to a market valuation of $1.2 trillion this year. Bitcoin's price last week hit an all-time high of $66,930.39, according to CoinMarketCap, a day after the first bitcoin-futures ETF launched.