Mastercard files patent for blockchain-based transactions
Mastercard has filed a patent for consumer protection and blockchain-based transactions at the US Patent and Trademark Office.
According to the patent, the technology is “a method for managing fractional reserves of blockchain currency”.
While this is early days, the concept has the potential to allow Bitcoin transactions on credit cards.
This tech stores fiat currencies in one “central account”, as well as “blockchain currency” in a second account, “storing a plurality of account profiles, each profile including a fiat currency amount, blockchain currency amount, account identifier, and address”.
The patent also says that: “The use of traditional payment networks and payment systems technologies in combination with blockchain currencies may provide consumers and merchants the benefits of the decentralised blockchain while still maintaining security of account information and provide a strong defence against fraud and theft.”
Mastercard says by processing such transactions, payment networks may be able to evaluate the likelihood of fraud and assess risk for blockchain transactions using existing algorithms and information, such as historical fiat and blockchain transaction data, credit bureau data, demographic information etc.
Patents are nothing new.
Back in November 2017, Mastercard jumped on the blockchain payments bandwagon by filing “Method and System for Instantaneous Payment Using Recorded Guarantees”.
The description said: “There is a need for a technical solution where a payment transaction can be guaranteed in a manner that is readily verifiable by an acquiring financial institution and/or merchant, and where the guarantee can be used in conjunction with multiple types of payment instruments as well as multiple transaction types, including e-commerce transactions.”
Recently, and in other areas, Mastercard is working with Strands to provide issuing banks with an integrated platform of digital cash management and commercial payment tools designed for SMEs.
Mastercard has also partnered with Worldpay, to allow the latter to offer its Pay by Bank app to merchants starting in early 2019.
