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Friday, September 29, 2023

Mastercard launches Web3 user verification solution to curb bad actors

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Global financial services giant Mastercard has launched a new Web3 solution aimed at enhancing user verification standards and “reducing the opportunities for bad actors” in the digital asset space.

The solution is dubbed the “Mastercard Crypto Credential” and its launch was announced on April 29.

In an accompanying explainer video shared to Twitter, the firm outlined that its “building a way for Web3 and blockchain service providers to help secure transactions between users, verified according to standards set by Mastercard.”

As part of the solution, users will be issued a “Mastercard crypto credential unique identifier,” which in theory, enables people to instantly verify that an address they want to send funds to has been vetted by Mastercard and has been operating in compliance with the firm’s standards.

“The solution is also designed to support compliance through the exchange of essential metadata, required to meet regulations,” Mastercard stated, adding that it should help “reduce the opportunities for bad actors and the risk of funds being lost for good.”

As such, even if bad actors slip through the cracks and obtain a unique identifier, it appears Mastercard can move quickly to revoke their verification, if they have been found to have engaged in nefarious activity.

The firm named a long list of partners behind the solution. On the wallet side of things, Mastercard has teamed up with crypto wallet providers Bit2Me, Lirium, Mercado Bitcoin and Uphold.

In terms of blockchains, the firm has partnered with Aptos Labs (Aptos), Ava Labs (Avalanche), Polygon Labs (Polygon) and The Solana Foundation (Solana).

Related: Bybit to introduce mandatory KYC requirements starting May 8

Mastercard also outlined that it will be “tapping into CipherTrace’s suite of services — including CipherTrace Traveler — to help verify addresses and support Travel Rule compliance for cross-border transactions.”

Mastercard has been continually upping its exposure to the crypto sector over the past couple of years, and the latest announcement comes just a few weeks after it launched a nonfungible token (NFT) gated musician accelerator program in collaboration with Polygon.

The program offers free access (until the end of April) to materials, unique artificial intelligence (AI) tools and other experiences to holders of Mastercard’s Music Pass NFT.

Mastercard competitor Visa also made a crypto move earlier this week, after Cuy Sheffield, the firm’s head of crypto took to Twitter on April 24 to announce a new stablecoin payments-focused project.

While details are sparse at this stage, Sheffield shared a job listing for the role which notes that the company is “building the next generation of products to facilitate commerce in everyone’s digital and mobile lives.” The company is on the lookout for someone with strong experience in Web3 and blockchain tech.

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