Mastercard enables non-custodial crypto spending in new partnership

Global payment giant Mastercard is expanding its support for non-custodial cryptocurrency wallets in a new collaboration that enables users to spend crypto while “being their own bank.”

After piloting a crypto debit card with the major self-custodial wallet MetaMask in August, Mastercard continues to connect traditional finance and crypto in a new partnership with the European crypto payments infrastructure Mercuryo.

In the collaboration, Mastercard has enabled a new euro-denominated debit card that allows users to spend cryptocurrencies like Bitcoin (BTC) stored on self-custodial wallets at more than 100 million merchants in the Mastercard network.

Mastercard takes the mission to drive crypto self-custody adoption

Self-custody is one of the core concepts of cryptocurrency, providing a method of storing assets without depending on any centralized platform, such as a bank or an exchange.

Unlike custodial wallets, self-custodial wallets require the user to take full responsibility for securing their funds by being the sole custodian of the private key that allows one to access the wallet.

According to Christian Rau, senior vice president of Mastercard’s crypto and fintech enablement, the firm’s collaboration with Mercuryo builds on its growing commitment to support self-custodial wallets.

“At Mastercard, we are working closely with partners to innovate and enhance the self-custody wallet experience,” Rau told Cointelegraph, adding:

“Through our collaboration with Mercuryo, we’re eliminating the traditional barriers between blockchain and conventional payments, providing consumers who want to spend their digital assets with an easy, reliable, and secure way to do so, anywhere Mastercard is accepted.”

Why does Mastercard want to support non-custodial wallets?

Founded in 1966, Mastercard operates an international payment card services corporation headquartered in the United States. It provides various financial services in more than 210 countries and territories.

As payments are considered one of the key use cases for crypto, Mastercard’s entrance into the crypto market was somewhat natural. The payment giant officially announced support of crypto on its network in February 2021, citing the growing role of cryptocurrencies and stablecoins in the payments world.

Since entering crypto more than three years ago, Mastercard has tapped multiple partners in the industry, including the USDC (USDC) stablecoin provider Circle, the major US crypto exchange Coinbase and many others.

According to Mastercard’s blockchain and digital asset lead Raj Dhamodharan, the company’s recently announced commitment to support self-custody aims to address the complexities associated with buying and selling crypto using a centralized exchange. He believes that many crypto hodlers “try to avoid” exchanges in the first place.

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“The complexities of this process have been an obstacle for both buyers and sellers as it limits both choice and the purchasing power of stored crypto,” Dhamodharan stated in August 2024.

Mastercard’s growing services in crypto and self-custody don’t come for free. For example, the new Mastercard-branded Spend card by Mercuryo incurs the 1.6 euro ($1.8) issuance fee and the 1 euro ($1.1) monthly maintenance fee, in addition to the off-ramp 0.95% fee levied by Mercuryo.

Cointelegraph approached Mastercard for comment regarding its growing role in the adoption of self-custody but did not receive a response at the time of publication.

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