Mastercard reported that 30% of its transactions in 2024 were tokenized, according to a recent filing with the US Securities and Exchange Commission (SEC).
The filing explicitly states:
“Approximately 30% of all Mastercard transactions are now tokenized.”
This disclosure underscores Mastercard’s commitment to digital finance while acknowledging the increasing competition in the evolving payments industry.
Rising Competition and Technological Shifts
Mastercard highlighted rapid technological advancements reshaping the financial landscape. The firm noted that blockchain innovations and enhanced cybersecurity are transforming payment systems, potentially introducing more efficient alternatives that could challenge existing technologies.
According to the company:
“These changes could result in new technologies that may be superior to, or render obsolete, the technologies we currently use in our programs and services. They may also result in new and innovative payment methods, products, and services.”
Mastercard also acknowledged the rise of stablecoins and cryptocurrencies as viable alternatives to traditional payment methods. Their efficiency and 24/7 accessibility have driven wider adoption, particularly in merchant transactions and business-to-business (B2B) payments.
Additionally, regulatory developments could further accelerate the adoption of digital currencies, impacting Mastercard’s operations.
The Role of CBDCs in Payment Networks
Mastercard stated that governments worldwide are actively researching central bank digital currencies (CBDCs), which could lead to the creation of dedicated financial networks. If this trend continues, Mastercard noted:
“[This may] impact the extent of our role in facilitating CBDC-based payment transactions, potentially impacting the transactions that we may process over our network.”
Mastercard’s Blockchain Strategy and Tokenization Efforts
To remain competitive, Mastercard is expanding its blockchain initiatives and increasing its tokenization efforts. The company is focused on developing secure, scalable, and interoperable blockchain-based payment solutions.
Mastercard stated:
“[We are] investing in the future and driving market transformation by extending the reach of our network to enable the tokenization of credentials, identities, assets, and data and the exchange of those items between counterparties.”
The company also highlighted that it holds patents in blockchain, artificial intelligence, and payment security, reinforcing its commitment to digital finance. Furthermore, Mastercard has developed technology to tokenize CBDCs across multiple blockchain networks, demonstrating its long-term vision in the digital payments sector.
Mastercard’s latest SEC filing highlights its embrace of tokenization as a fundamental strategy for navigating the rapidly evolving digital payments landscape. As cryptocurrencies, stablecoins, and CBDCs gain momentum, the company is strategically positioning itself to adapt and lead in the future of global finance.
