Crypto exchange Binance, has recently initiated its partnership with payments company Mastercard in Brazil.
The partnership involves the creation of a prepaid card, with which to make cryptocurrency payments.
The card will include payments using as many as 13 cryptocurrencies, and is expanded for any type of use. For the time being, it is still in a beta test phase, but the product will be released in the coming weeks, so said a Binance spokesperson.
The reasons for the Binance crypto exchange’s partnership with Mastercard
Brazil kicks off one of Binance’s first collaborations with Mastercard. We are certainly talking about a no small piece of news, which sees two giants in the finance industry joining together to achieve common goals.
The Binance-branded prepaid card will be valid in the South American country for anyone with a valid national ID.
According to a statement on Binance’s blog, a fee will be charged for each crypto transaction, worth 0.9%. However, cashback service will be offered (up to 8%) and will allow ATM withdrawals without fees.
If you are wondering why this collaboration is taking place in a country like Brazil, Binance’s blog gave a way to explain that as well. Binance, in very comprehensive fashion, after careful analysis pointed out the importance of the exchange market in the South American federal state.
Not surprisingly, Brazil is among the most important states to support Binance globally. Further confirmation came from the general manager of Binance Brazil, Guilherme Nazàr, who said in a press release:
“Brazil is an extremely relevant market for Binance and we will continue to invest in new services for local users, as well as contribute to the development of the blockchain and crypto ecosystem in the country.”
Brazil seems to be a very engaged nation in the crypto universe. Recent studies from 2022 highlighted that about 49% of consumers in Brazil said they had conducted a transaction using cryptocurrencies in the past 12 months. The country seems well above average, considering the global average is fixed at 41%.
The president of Mastercard Brazil, Marcelo Tangioni, is excited about the collaboration; he explained in an interview how eager Brazilians are to use cryptocurrencies in other ways and not just as an investment asset. The collaboration with Mastercard will give them a way to make secure and effective transactions.
Tangioni further added:
“The Binance Card is part of our ongoing efforts to evolve the relationship between existing financial services and the growing crypto ecosystem. The card is in its beta launch phase in Brazil and will be widely available in the coming weeks.”
Binance’s goals in the Brazilian market
When kicking off a partnership of this magnitude, with such an impressive partner, one must have firm goals. Binance has no shortage of those, and although the Binance card is still in a beta stage, Binance is very clear about its goals.
Brazil is a very controversial country; while it is one of the largest growing crypto markets, tens of millions of Brazilians lack access to basic monetary services. Moreover, many citizens still seem reluctant to move forward despite having access to suitable financial resources.
The general manager of Binance Brazil spoke to microphones this way:
“Payments are one of the first and most obvious use cases for cryptocurrencies, but adoption has a lot of room to grow. We believe the Binance Card is a significant step in encouraging wider cryptocurrency use and global adoption, and Brazilians’ openness to innovation makes the country a great market for this version.”
Stating that this partnership could also mean real innovation for Brazil.
The launch of prepaid cards, could make sure to first and foremost increase interest in cryptocurrencies and improve eventual financial inclusion in the federal state of South America.
Referring to the Brazilian political situation, the country’s recent political turmoil before and after the new president’s election has triggered a problem of inflation and general financial problems. Given this context, cryptocurrencies such as Bitcoin or other altcoins, have become increasingly relevant and thick in Brazil.
Brazil seems ready for this collaboration, and Binance increasingly seems to be moving forward toward its goal of expanding the connection between traditional finance and cryptocurrency finance.
The same collaboration has already taken place in Argentina
It seems that South America is one of the most fertile grounds for collaborations between Binance and Mastercard. Indeed, a prepaid card involving payment through cryptocurrencies was launched in Argentina long before Brazil. The collaboration project in Argentina was launched in August 2022, and is already in use now.
The main features are the same, cashback at 8%, the same transaction fees (max 0.9%), and free ATM withdrawals.
Like in Brazil, the card can be applied for by anyone with a valid national identity card in Argentina. Similarly, Argentina’s precarious political situation and rising inflation have pushed citizens toward the cryptocurrency world.
Binance cardholders are able to manage their cards through the card dashboard on the Binance app and website. Users are also able to view transaction history and access customer support through the card dashboard.
Walter Pimenta, Executive Vice President, Products and Innovation, Mastercard Latin America and the Caribbean, said:
“Our work with digital currencies builds on our strong foundation to enable choice and peace of mind when people buy and pay. Together with our partners, Mastercard has led the payments industry in enabling entry into this exciting new world, helping to bring millions of additional users into cryptocurrencies and other digital assets securely and reliably.”