Two of the biggest players in the fiat and cryptocurrency markets are joining forces to establish a bridge. Mastercard announced late last night cooperation with crypto exchange Coinbase that would allow customers to acquire non-fungible tokens (NFTs) using fiat cash utilizing Mastercard cards.
Also, the payment processor claimed its September 2021 acquisition of crypto intelligence startup CipherTrace will help protect NFT purchases on its network.
While the NFT market has been growing steadily until 2021, one major barrier to entry is that customers must possess cryptocurrency to acquire NFTs. Today, to acquire an NFT — such as a digital artwork — you must first open a crypto wallet, buy crypto, and then use it to purchase an NFT in an online marketplace.
At the time of writing, Bitcoin was trading for nearly $42,000 on Indian platforms. While you may trade on an exchange for as little as $100, holding enough bitcoin to buy NFTs is tough for most consumers. Spending fiat dollars directly fixes the issue.
They will work together on Coinbase’s new NFT platform, unveiled in October. Mastercard will “classify NFTs” as “digital goods,” according to a blog post from the crypto exchange.
Not just Coinbase is considering bringing fiat currency to the world of NFTs. Last year, OpenSea, the world’s largest NFT platform, collaborated with MoonPay to accept fiat.
MoonPay operates as a middleman, converting fiat to crypto. It’s unclear if Mastercard’s involvement implies NFTs will be bought directly with fiat currencies, but it’s a start the sector has been waiting for.
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