Financial services firm Mastercard announced on Wednesday that it will begin allowing cardholders to transact in certain cryptocurrencies on its network, becoming the latest company to embrace digital assets.

"We are now preparing for the future of crypto and payments, announcing that this year Mastercard will begin to support select cryptocurrencies directly on our network," MasterCard said in a blog post.

The company is also actively engaging with central banks around the world on their plans to launch new digital currencies.

Raj Damodharan, executive vice president of digital assets, blockchain products, and partnerships, said the company will prioritize consumer protections and compliance in its own plans.

Mastercard has already partnered with some of the largest cryptocurrency firms, including Wirex and BitPay.

"Our change to supporting digital assets will allow many merchants to accept crypto, an ability that’s currently limited by proprietary methods unique to each digital asset," Dhamodharan said.

"This change will also cut out inefficiencies, allowing both consumers and merchants to avoid having to  convert back and forth between crypto and traditional to make purchases."

Mastercard's announcement comes after Tesla Inc said it invested $ 1.5 billion in Bitcoin this week, sending the cryptocurrency to a record high.

Dhamodharan said: "Our philosophy on crypto is straightforward - it's about choice. Mastercard isn’t here to recommend that you start using crypto. But we are here to enable customers, merchants, and businesses to move digital value."

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