When Mastercard and Binance announced a partnership to bring prepaid crypto cards to Brazil, a Mastercard spokesperson explain The move is “an exciting step in our cryptocurrency journey.”
Now, Mastercard is taking another step on this journey: ending its partnership with Binance.
The cryptocurrency exchange’s customer service account announced its dissolution in a post on X/Twitter on Wednesday evening. “Users in Latin America and the Middle East will no longer be able to use Binance Card,” the account said. “Only a small percentage of our users (less than 1% of users in the mentioned markets) are affected.”
Users in Latin America and the Middle East will no longer be able to use Binance Card. Like most debit cards, the product has been used by Binance users to cover basic day-to-day expenses, but in this case the cards are funded with crypto assets. Only a tiny…
— Binance Customer Support (@BinanceHelpDesk) August 23, 2023
Users with MasterCard-linked Binance cards, which allow customers to use cryptocurrencies in Binance accounts to make purchases with fiat currency, will not be able to use the cards in Argentina, Brazil, Colombia, and Bahrain starting September 22. Binance said its Mastercard partnership will also no longer include Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. Asked to confirm exactly which countries in the Middle East would be affected, Mastercard said in a later email that there were “only four pilot programs in the market,” without specifying whether one would be Bahrain or the entire GCC.
A Binance spokesperson gave the same statement as the original X/Twitter post in response to a request for comment, while a Mastercard spokesperson said in an email that wealth Waiting until the end of September to end the partnership “provides a transition period for cardholders to convert any assets held in their Binance Wallet.” (A Binance spokesperson said separately Tell Bloomberg Visa, which has a similar partnership, stopped issuing co-branded cards in Europe last month. )
Asked in an interview in May whether Mastercard was reconsidering its relationship with Binance and other cryptocurrency firms targeted by U.S. regulators, Mastercard’s executive vice president and head of cryptocurrency and blockchain said: Raj Dhamodharan didn’t directly answer the question. “The security of our network and the consumer experience is our top priority,” he told us wealth.
The end of Mastercard’s relationship with Binance comes as the world’s largest cryptocurrency exchange faces a growing legal and public relations crisis.
In March, the Commodity Futures Trading Commission sued Binance and its CEO Changpeng Zhao, accusing the exchange of deliberately steering U.S. cryptocurrency traders away from Binance’s U.S. subsidiary to more profitable international exchanges, among others.
In June, the SEC upped the legal stakes when it sued Binance and Zhao Yun, laying even more explosive charges, including claims that the cryptocurrency exchange and its CEO flouted U.S. money-laundering laws.
Now, Binance and Zhao are facing potential criminal prosecution by the Justice Department, which has prompted a series of executive resignations over Zhao’s response to the government investigation.