Mastercard to end partnership with Binance in Latin America
Mastercard, the global payment giant, is set to terminate its partnership with cryptocurrency exchange Binance in Latin America next month, according to a report by Bloomberg. The decision comes amidst increasing regulatory scrutiny faced by Binance.
Impact on crypto card programs in Latin America
Starting from September 22, Mastercard and Binance will conclude their four crypto card programs in Argentina, Brazil, and Colombia, as reported by Bloomberg on August 24. However, the termination of this partnership will not affect Mastercard's other crypto card programs.
Conversion of Binance holdings
During the wind-down period, cardholders will be able to convert their holdings in their Binance wallets, Mastercard reportedly announced. This will allow users to seamlessly transfer their funds.
About the Mastercard-Binance prepaid crypto card
The prepaid crypto card issued by Mastercard and Binance enables users to make payments in local fiat currencies by utilizing their cryptocurrency holdings on the exchange. This innovative solution was introduced as part of the partnership between the two companies last year.
A response to regulatory challenges
The termination of the collaboration suggests that Binance's regulatory issues worldwide could be a driving force behind the decision. Binance and its CEO, Changpeng "CZ" Zhao, have faced legal action from the United States Securities and Exchange Commission for alleged violations of local securities laws. The U.S. Commodity Futures Trading Commission has also sued Binance for not properly registering with the derivatives regulator.
Other firms distancing themselves from Binance
The report reveals that Mastercard is not the only firm severing ties with Binance due to regulatory concerns. Visa has reportedly stopped issuing new co-branded cards with Binance in Europe since July.
Both Mastercard and Binance have declined to comment on the termination of their partnership.
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