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08/13/2024

MetaMask Launches Self-Custody Debit Card Pilot with Mastercard

Over 1 billion people worldwide remain unbanked or underbanked, according to 2022 data from the World Bank. MetaMask, the popular DeFi wallet, has partnered with Mastercard and digital payments company Baanx to roll out a self-custody debit card pilot for select users in the United Kingdom and European Union, with plans to expand the product to other regions over time. The card lets users maintain self-custody of their funds until a transaction is processed

MetaMask Launches Self-Custody Debit Card Pilot with Mastercard

Over 1 billion people worldwide remain unbanked or underbanked, according to 2022 data from the World Bank.

MetaMask, the popular DeFi wallet, has partnered with Mastercard and digital payments company Baanx to roll out a self-custody debit card pilot for select users in the United Kingdom and European Union, with plans to expand the product to other regions over time.

The card lets users maintain self-custody of their funds until a transaction is processed, with customers' digital assets converted into fiat currency for payments at retail stores, online shopping sites, and other merchants.

How It Works

In a statement to Cointelegraph, Lorenzo Santos, Senior Product Manager at ConsenSys, explained that users need to hold their crypto on the Linea network and use Linea to set spending limits on the card.

Santos also walked through how transactions are processed end to end. According to him, when a MetaMask card is swiped, an on-chain transaction is triggered, sending tokens from the user's wallet to the "Crypto Life" smart contract.

This allows the transaction to be authorized by the merchant's point-of-sale system, with the crypto-to-fiat conversion handled by that smart contract. Payment is then finalized through Mastercard's payment network.

Customers will also have the option to choose which crypto asset is used for payment, and users retain control over where their keys are stored.

Banking the Unbanked

While MetaMask's new pilot is currently limited to European markets, initiatives like this could bring financial services to unbanked populations worldwide and streamline crypto payments for people living in high-inflation environments. Simon Jones, Chief Commercial Officer of Baanx, said:

"With 1.2 billion people around the world unbanked, we're working toward a vision where anyone with a mobile phone can access financial services. Using new technologies to bring everyone into the financial system is our goal."

The head of Nigeria's Securities and Exchange Commission, Emomotimi Agama, recently highlighted the potential of digital assets to extend banking access to the country's 38 million unbanked adults.

According to Chainalysis, crypto accounted for 9% of the $5.4 billion in remittances sent to Venezuela in 2023. The share of remittances flowing to the South American country has grown year over year since 2018, except in 2020 — the year COVID-19 caused widespread inconsistencies in financial reporting figures.

Argentina is another example, where residents are turning to crypto assets to hedge against a staggering 276% inflation rate that is eroding the value of their local currency.