Mastercard, Bakkt team up for crypto card payments

Mastercard has formed a partnership with Bakkt, giving banks a way to issue rewards-based cryptocurrency debit and credit cards to consumers.

The collaboration will enable customers of any financial institution or fintech connected to the Mastercard network to manage digital assets via Bakkt’s custodial wallets and spend cryptocurrency rewards they earn at Mastercard merchants, the companies announced on Monday.

Mastercard laid the groundwork for this deal in February when the card network said it would soon begin processing crypto payments, though in this case Bakkt acts as a middleman.

“Together with Bakkt and grounded by our principled approach to innovation, we’ll not only empower our partners to offer a dynamic mix of digital assets options, but also deliver differentiated and relevant consumer experiences,” Sherri Haymond, Mastercard’s executive vice president of digital partnerships, said in a press release.

“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 and payments, said in the release.

Bakkt, which launched three years ago and is based in Alpharetta, Georgia, has been steadily expanding its reach across the consumer payments and banking ecosystems.

Starbucks earlier this year began enabling its customers to use the Bakkt app to convert loyalty points from hotels and airlines into U.S. dollars for reloading their Starbucks Card within the Starbucks app. Wyndham Hotels & Resorts has a similar deal with Bakkt, which has its own Visa debit card.

The banking software vendor Finastra recently announced plans to add Bakkt’s digital wallet to its app store to allow community banks and credit unions to offer their own cryptocurrency-management products.