Coinbase Mastercard Partnership Aims to Classify NFTs as “Digital Goods”

Cryptocurrency exchange platform Coinbase inked a partnership with financial giant Mastercard to revolutionize the NFT purchase experience!

Thanks to this deal, customers will be able to use Mastercard credit and debit cards to make purchases in Coinbase’s upcoming NFT Marketplace. The partners are working together to classify NFTs as “digital goods” to encourage more consumers to purchase NFTs.

About Coinbase and Mastercard’s Partnership

According to the announcement, “Coinbase wants to simplify the user experience to allow more people to join the NFTs community.” It aims to replicate its success in helping millions of people access Bitcoin for the first time. This time, the platform will expand the reach of NFTs to the mass market.

Last year, Coinbase announced the launch of the peer-to-peer marketplace Coinbase NFT. The leadership team is confident that they can provide a better customer experience with Mastercard in the picture. The complexity of purchasing NFTs remains to be the biggest barrier to entry for new users. Right now, customers first need to open up and fund a crypto wallet in order to transact in an NFT marketplace. So Mastercard would be an alternative and easier way to purchase NFTs.

Mastercard’s Raj Dhamodharan said, “Getting more people involved safely and securely is perhaps the best way to help the NFT market thrive. As it does, Mastercard sees even greater potential for NFTs’ underlying tech to go beyond art and collectibles into many more areas.”

Traditional Financial Institutions Entering the NFT Space

In 2021, Collectors and enthusiasts spent $22 Billion on NFTs, according to DappRadar. The industry is booming and the numbers can back it up. For example,  OpenSea recorded $3.4 Billion in trading volume in just 15 days this January 2022. Aside from celebrities, athletes, brands, sports teams and franchises, traditional financial institutions are now moving to embrace NFTs.

Mastercard, one of the world’s largest credit card and payment companies, is aggressively booking partnerships with crypto companies. Last October 2021, it announced a partnership with Bakkt to let banks and merchants in its network offer crypto-related services. It has also partnered up with Gemini, BitPay and Mintable.

Similarly, top rival VISA has more than 60 partnerships with companies in the Crypto space, including Coinbase. Meanwhile, American Express has also said it’s exploring using its cards and network with stablecoins. However, CEO Stephen Squeri recently told Yahoo Finance that consumers should not expect to see an Amex-crypto-linked card “anytime soon.”

When traditional auction houses Christie’s and Sotheby’s, the gatekeepers, opened their doors to NFTs, it energized the market. It also boosted the confidence of collectors and enthusiasts. So with traditional financial institutions like Mastercard making their way into the NFT space, we’ll see more innovations and hopefully new generational projects this year.