Mastercard to end prepaid crypto card program with Binance after calling partnership ‘exciting step in our crypto journey’
When Mastercard and Binance announced they were partnering to bring a prepaid crypto card to Brazil, a Mastercard spokesperson said the move was “an exciting step in our crypto journey.”
Now, Mastercard has taken another step in that journey: ending its partnership with Binance.
The crypto exchange’s customer service account announced the breakup in a post on X/Twitter on Wednesday evening. “The Binance Card will no longer be available to users in Latin America and the Middle East,” said the account. “Only a tiny portion of our users (less than 1% of users in the markets mentioned) are impacted.”
Hello there,
The Binance Card will no longer be available to users in Latin America and the Middle East. The product, like most debit cards, has been utilized by Binance’s users to pay for basic daily expenses but in this case, the cards are funded with crypto assets. Only a tiny…— Binance Customer Support (@BinanceHelpDesk) August 23, 2023
Those with Mastercard-linked Binance Cards, which allow customers to use crypto from Binance accounts to make purchases in fiat, will no longer be able to use them beginning Sept. 22 in Argentina, Brazil, Colombia, and Bahrain. Binance said its Mastercard partnership also will no longer include Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. Mastercard, when asked to confirm exactly which nations in the Middle East would be affected, said in a later email there were “only four pilot programs in market” without specifying whether one of those was just Bahrain or the entire Gulf Cooperation Council.
A Binance spokesperson responded to a request for comment with the same statement from the initial X/Twitter post, while a spokesperson for Mastercard said in an email to Fortune that waiting to end the partnership until late September “provides cardholders with a wind-down period to convert any holdings in their Binance wallet.” (A Binance spokesperson separately told Bloomberg that Visa, which had a similar partnership, stopped issuing co-branded cards in Europe last month.)
In a May interview, when asked whether Mastercard was reconsidering its relationships with Binance and other crypto companies in the crosshairs of U.S. regulators, Raj Dhamodharan, a Mastercard executive vice president and the firm’s head of crypto and blockchain, did not respond directly to the question. “[The] safety and security of our network and consumer experiences are the number one priority for us,” he told Fortune.
The winding down of Mastercard’s relationship with Binance comes amid an increasingly fraught legal and public relations crisis for the world’s largest crypto exchange.
In March, the Commodity Futures Trading Commission sued Binance and its CEO, Changpeng Zhao, over the exchange’s allegedly deliberate efforts to direct American crypto traders away from Binance’s American subsidiary to its more profitable international exchange, among other allegations.
In June, the Securities and Exchange Commission upped the legal ante when it sued Binance and Zhao, filing even more explosive allegations, including claims that the crypto exchange and its CEO flouted U.S. money laundering laws.
And now, Binance and Zhao are facing a potential criminal indictment from the Justice Department, which has prompted a suite of executives to quit over Zhao’s response to the government’s investigation.
