Mastercard and Visa have distanced themselves from Binance Holdings by withdrawing their card partnerships. Visa has ceased issuing new co-branded cards with Binance in Europe since July, as stated by a Binance spokesperson.
In a similar vein, Mastercard plans to end its card collaboration with Binance in September, although they haven’t provided a specific reason for this decision. Despite requests for comment, Visa did not respond, according to Gulf News.
Binance has faced extensive scrutiny from global financial regulatory bodies, particularly amid an industry crackdown prompted by various incidents and controversies over the past year.
Binance, along with its CEO Changpeng “CZ” Zhao, faced legal action from the US Securities and Exchange Commission. This action was taken for violating securities regulations. Additionally, they encountered legal action from the Commodity Futures Trading Commission for evading rules that allowed US users access to the platform. Binance has contested all of these allegations.
The company faced setbacks, including experiencing a cut-off from the US banking system in February and losing the ability to accept certain bank transfers in Australia in May.
Impact on Mastercard’s Co-Branded Card Initiatives
Recently, Binance chose to shut down Binance Connect, a one-year-old product enabling businesses to accept cryptocurrency via Visa and Mastercard. Its European banking partner will also cease support in September.
Binance Card, an initiative aimed at promoting wider cryptocurrency adoption, enabled users to cover daily expenses with crypto assets. Binance introduced the Binance Visa Card program in September 2020.
Mastercard’s choice will impact its co-branded card initiatives with Binance across Argentina, Brazil, Colombia, and Bahrain, effective from September 22, according to a statement from the credit-card company.
Binance conveyed through a post on the social platform X (previously known as Twitter) that this decision will affect fewer than 1 percent of users in Latin America and the Middle East. They clarified that Binance accounts worldwide will remain unaffected.
Mastercard affirmed that there will be no repercussions for any other cryptocurrency card scheme. The gradual phase-out period will enable cardholders to convert their holdings within their Binance wallets, as stated.
