Blockchain Adapts to the Needs of Mastercard for Coupon Authentication System

The US Patent and Trademark Office (USPTO) granted a new patent for Mastercard on May 31st, 2018 for the brand to integrate blockchain technology into their system for validating coupons. In this patent, the company can reduce the amount of fraud that merchants experience with coupons. Furthermore, this information and validation enables the brand to solicit customers with discounts that specifically apply to their needs. This patent has been waiting since November 2016 to be awarded.

Each customer that embarks on this blockchain effort will be assigned their own blockchain address with all their credentials. These credentials will be attached to their choice of a credit card or a digital wallet. When they use a coupon at a POS purchase, the applicable device will communicate with the user’s individual blockchain network to ensure that the discount pertains to them. If the transaction is successful, then the coupon will be deducted from their digital wallet and moved to a digital file with coupons that are no longer usable.

While this technology will primarily help merchants to preserve their own integrity in their transactions, it will also help consumers to get the most out of the coupons that different businesses offer. Since the coupons are customized offers that are based on the user’s activity, they will not be replicated or used by any other customer.

Even though Mastercard’s patent is important enough to make headlines, they are not the only one that has integrated blockchain technology to better serve merchants and customers. American Express also announced that they would be integrating blockchain as well as an effort to improve their loyalty rewards program. Their system is setup on Hyperledger, where the members of the rewards program can claim offers, while earning bonus points for specific purchases.

As far as cryptocurrency goes, the CEO of Mastercard, Ajay Banga, has said that they will be involved with government created tokens in the future, though they called non-government tokens “junk.”

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