Binance Card Services Discontinued in Latin America as Mastercard Ends Partnership

Updated: 25 August 2023

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Global payment leader Mastercard Inc. and cryptocurrency exchange giant Binance have terminated their crypto debit card partnership in Latin American countries.

According to a Bloomberg report on August 24, the partnership will end on September 22, affecting countries including Argentina, Brazil, Colombia, and Bahrain.

Although the report didn’t directly state the reason behind the change, it hinted at the possibility that increased regulatory scrutiny faced by the struggling crypto exchange might have played a role in this decision.

In a recent X (former Twitter) announcement responding to user concerns, Binance revealed that its crypto-funded debit card, the Binance Card, will be discontinued. The card, which functions much like a conventional debit card by utilizing crypto assets for transactions, will be halted with a marginal impact on its user base in Latin America and the Middle East.

According to the exchange, the discontinuation will affect a mere 1% of its customers from these regions.

The company reassured its global user base that discontinuing the Binance Card would not disrupt its services beyond the specified regions. Binance’s international account holders will still have the option to explore other avenues, such as shopping with cryptocurrencies and leveraging Binance Pay.

“Binance accounts around the world are not affected. Where available, users can also shop with crypto and send crypto using Binance Pay, a contactless, borderless, and secure cryptocurrency payment technology designed by Binance,” stated the company.

Hello there,
The Binance Card will no longer be available to users in Latin America and the Middle East. The product, like most debit cards, has been utilized by Binance’s users to pay for basic daily expenses but in this case, the cards are funded with crypto assets. Only a tiny…

— Binance Customer Support (@BinanceHelpDesk) August 23, 2023

Fostering Crypto Adoption

Binance and Mastercard collaborated in August last year, enabling users to convert their cryptocurrency holdings into traditional fiat currency. This partnership also allowed users to earn cash back in cryptocurrencies, potentially reaching up to 8%, contingent on the nature of their purchases.

Notably, while customers utilized their crypto assets for transactions, merchants continued to receive payments in fiat currency. This strategic move aimed to encourage wider acceptance and adoption of cryptocurrencies in the broader financial ecosystem.

In the same month, Argentina took the pioneering step of becoming the first country to embrace the Binance crypto card program. This decision was driven by the nation’s elevated inflation rate, prompting consumers to explore alternative payment avenues, including adopting cryptocurrencies.

Regulatory Pressures and Industry Shifts

The termination of the Mastercard-Binance partnership comes amid a series of regulatory challenges and industry shifts that Binance has grappled with. The cryptocurrency exchange has been under increased scrutiny and legal pressure, particularly in the United States.

The U.S. Securities and Exchange Commission (SEC) filed a lawsuit against the crypto exchange, claiming it had violated securities laws. The US Department of Justice has also placed Binance under scrutiny for possibly enabling the platform users to avoid penalties.

This regulatory backdrop has prompted several companies to reassess their associations with Binance. According to the report, Visa, another major player in the payment industry, ceased issuing new co-branded cards with Binance in Europe earlier this year.

Furthermore, London-based payment processor Checkout.com recently terminated its contract with Binance early this month due to concerns related to money laundering and compliance issues.

In June, Paysafe Payment Solutions, Binance’s banking partner for euro transactions, announced its decision to discontinue its services for the leading global cryptocurrency exchange, effective September 25th.