Payments giant Mastercard announced an enhanced card program for cryptocurrency wallets and exchanges that aims to make it easier for partners to convert cryptocurrency to fiat currency.
The program is expected to reduce friction and improve customer experience as well as provide greater flexibility for consumers who want to spend their digital assets wherever Mastercard is accepted, the company said. The suite of program partners includes Circle, Paxos, Evolve Bank & Trust, Metropolitan Commercial Bank, Uphold, BitPay, Apto Payments, i2c Inc, and Galileo Financial Technologies.
When cryptocurrencies are spent today, they can only be settled on the Mastercard’s network using fiat currency like the US dollar, which meant that companies with their own card programs had to perform the currency conversion.
“Today not all crypto companies have the foundational infrastructure to convert cryptocurrency to traditional fiat currency, and we’re making it easier,” said Raj Dhamodharan, Executive Vice President of Digital Asset and Blockchain Products at Mastercard.
The solution comes as a result of collaboration between Mastercard, Evolve Bank & Trust, and stablecoin issuers Paxos Trust Company, the issuer of Paxos Standard (PAX) US dollar-backed stablecoin, and Circle, the issuer of the second-largest (by market capitalization) stablecoin, USD Coin (USDC).
The pilot of the solution will use the USDC and PAX stablecoins to “facilitate crypto-to-fiat conversions” amongst card issuers to make it easier to settle payments to Mastercard.
“The collaboration between Circle and Mastercard demonstrates that dollar digital currencies like USDC play a foundational role in making payments more efficient and can facilitate new economic activity for businesses worldwide,” Dante Disparte, Chief Strategy Officer at Circle, was quoted as saying.
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