Mastercard expands stablecoin integration with new partners

In essence, the company is looking to align itself with several major firms as digital asset strategies develop across the financial sector. 

As part of these efforts, Mastercard will join Paxos’ Global Dollar Network and has signalled its intent to integrate PayPal’s PYUSD and Fiserv’s proposed FIUSD stablecoin. The card network already supports Circle’s USDC, currently the second largest stablecoin by market capitalisation. 

A representative from Mastercard stated the company is enabling consumers to use their stablecoin balances for transactions at more than 150 million merchant locations globally. These capabilities are provided through existing arrangements with crypto wallets and exchanges including MetaMask, Crypto.com, OKX, Kraken, Binance, Bybit and Coinbase. However, the firm underscored that stablecoins alone do not offer the same security, acceptance, and infrastructure provided by established card networks, and said its role is to help bridge those gaps.

Mastercard and Fiserv aim to connect digital asset platforms 

Mastercard’s work with Fiserv includes linking the latter’s Digital Asset Platform, which supports bank-issued stablecoins, with the Mastercard Multi-Token Network. This infrastructure enables financial institutions, fintechs and public sector entities to experiment with and verify digital asset applications. 

In addition, Mastercard is updating its existing Move service to allow wallets and financial institutions to send and receive stablecoins. These updates arrive as the US legislative environment, particularly the GENIUS Act, prompts more institutions to prepare their own digital currency strategies.

Representatives from Mastercard stated that while stablecoins can offer several advantages such as faster cross-border transfers, automated B2B payments, and real-time earnings for gig workers.

The card network’s approach reflects ongoing concerns about disintermediation. Stablecoin-based payment systems, while not commonly used at the point of sale today, could potentially sidestep traditional card networks through direct conversions between fiat and digital currencies at both ends of a transaction. This poses a potential challenge to existing card-based revenue models.

The growth of interest from large retailers is also drawing attention. Walmart and Amazon have been linked to internal stablecoin projects, seen by some as responses to long-running disputes with card networks over transaction fees.