If you’re hankering for the latest NFT offering from Grimes or Paris Hilton, you’ll soon be able to pay for it with a Mastercard—at least once Mastercard’s new partner Coinbase gets its online marketplace up and running.
- Mastercard and Coinbase are teaming up to make non-fungible tokens available for purchase with a credit or debit card.
- While the tokens are usually bought by crypto enthusiasts using crypto wallets and Ethereum, once Coinbase launches its new marketplace, people will be able to use a regular Mastercard.
- The partnership is expected to expand the growing NFT market to a more mainstream audience.
Mastercard and Coinbase, a cryptocurrency exchange platform, are teaming up to allow customers to pay with credit or debit cards for non-fungible tokens on an NFT marketplace run by Coinbase, the companies said Tuesday. Customers will be able to use a regular Mastercard, not necessarily one that is crypto-linked, so they can effectively pay with plain old dollars, which is new: Normally, buying an NFT would require you to open a cryptocurrency wallet, buy crypto, specifically Ethereum, then use it to purchase the NFT in an online marketplace.
For a cryptocurrency veteran, that process may be easy, but for others, not so much, according to Mastercard. “For most people, it's not simple, it’s not intuitive. We think it should be much easier. That will ensure NFTs can be for everyone," said Raj Dhamodharan, executive vice president for Mastercard, in a statement.
Non-fungible tokens are digital assets that are verified by blockchain technology. Fungible means interchangeable, so non-fungible is the opposite: NFTs, unlike cryptocurrencies, are considered to be unique. They are often pieces of digital art, like a digital painting or a video from a musical artist, but they can also be things as hard to quantify as tweets.
Purchasers of NFTs are sometimes collectors, sometimes investors, and sometimes speculators. What they own when they buy an NFT is the token, not the underlying artwork or object, copyright, or any sort of intellectual property.
The popularity of NFTs exploded last year, when pop culture icons like Coca-Cola, the NBA, and Paris Hilton began creating and selling their own unique digital assets. Trading volume skyrocketed to $23 billion from about $63 million in 2020, according to DappRadar, which tracks the market.
Even so, NFTs are not exactly a household item. Coinbase said it wants to make them more mainstream with its marketplace, Coinbase NFT, which will allow people to trade, sell, and create NFTs. Coinbase NFT has a waitlist for those who want early access once it goes live.
“Coinbase was basically an on-ramp for crypto for many, many users,” said Prakash Hariramani, Coinbase senior product director for payments and commerce, in a statement. “Millions of people were able to access bitcoin for the first time by using Coinbase. So we want to do the same thing for NFTs with Mastercard by solving the pain points—to make it as easy as possible to buy an NFT and make sure it’s the best consumer experience.”
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