Mastercard Cuts Ties: Binance Partnership Ditched in Four Nations

Mastercard, a prominent global payments enterprise, is in the process of dissolving its crypto card payment partnership with Binance, a notable cryptocurrency exchange. Consequently, the crypto card initiatives operating in four countries ─ Argentina, Brazil, Colombia, and Bahrain ─ are slated for termination by 22 September.This significant decision was communicated by a Mastercard spokesperson via email yesterday. The Binance crypto cards, which facilitate payments in traditional currencies through cryptocurrency assets held on the exchange, will be impacted by this development.

Within the realm of cryptocurrency, Mastercard has also established collaborative ties with other crypto exchanges, notably Gemini, as outlined on its official website. It is pertinent to note that the forthcoming changes will exclusively affect the Binance programme, leaving the integrity of other crypto card programmes intact, as confirmed by the spokesperson.

Raj Dhamodharan, Mastercard's Head of Crypto and Blockchain, shared insights into the company's aspirations for expanding partnerships within the cryptocurrency sector. While he refrained from commenting directly on the Binance scenario, Raj emphasised the rigorous due diligence all card programmes undergo and the continuous vigilance exercised.

In the midst of these transitions, queries regarding the reasons behind the conclusion of the Binance programme and the decision-making entities remain unanswered by Mastercard's spokesperson. Binance, likewise, has not yet responded to inquiries sent. Anticipating this shift, Binance's customer support account on X (formerly known as Twitter) disclosed earlier on Thursday that the availability of the Binance Card would cease for users in Latin America and the Middle East.

What Caused the Partnership Termination?

While the precise impetus behind this sudden turn of events remains veiled, it seems poised to intertwine with the intricate tapestry of regulatory challenges currently ensnaring Binance within the United States (US). A seismic juncture emerged in June when the US Securities and Exchange Commission (SEC) levelled a litigious salvo against the eminent exchange, alleging transgressions of US securities laws. A barrage of approximately 13 charges descended upon both Binance and its Chief Executive Officer, Changpeng Zhao (CZ).

Within this contentious landscape, the exchange stands accused of operating within the US in contravention of the law, mishandling the assets entrusted by its clientele, disseminating misleading information to both overseeing bodies and investors, and intriguingly, featuring unregistered securities amongst its offerings. Tokens of note such as Cardano (ADA), Polygon (MATIC), and Solana (SOL) were ensnared in the tangle of unregistered securities.

It should be noted that CZ initially asserted ignorance regarding the official complaint lodged against the exchange. Nonetheless, a subsequent chapter reveals a shift in stance, as Binance embarked on a resolute course of action, expressing its dismay at the SEC's actions while steadfastly affirming its intent to challenge the allegations in a court of law.

Noteworthy to mention, this development arrives seven months after the card's launch was celebrated in Brazil. A mere span of time since January when Mastercard and Binance jointly unveiled their pioneering crypto card venture within the vibrant contours of the Latin American landscape.