Mastercard Outlines Plans for Cryptocurrencies, Stablecoins, Central Bank Digital Currencies

Mastercard’s CEO outlined the company’s plans to develop products and services around cryptocurrencies, stablecoins, and CBDCs. “We want to play a role in all aspects… Clearly, this is a very dynamic space,” the CEO said.

Last Thursday, payments giant Mastercard provided an update on its cryptocurrency plans during the company’s earnings call. CEO Michael Miebach explained that his company hopes to play in three areas of cryptocurrency. In addition to cryptocurrencies such as Bitcoin, the company is also eyeing stablecoins in the private sector, as well as central bank digital currencies (CBDCs). He affirmed:

“We want to play a role in all aspects. … It’s obviously a very dynamic area. … It’s a very relevant technology. As a multi-track player, we have to be involved because people are looking for answers.”

Regarding cryptocurrencies, Miebach explained, “We are making it easier for cryptocurrency wallets to seamlessly connect to our network through pilots with Paxos, Circle, and Evolve Bank & Trust, which simplifies the conversion of crypto to fiat.” The executive added, “Separately, we are working with Ethereum software engineering firm Consensys to accelerate the development of cryptocurrency applications and services to our customers.”

Regarding cryptocurrency investments, Miebach said:

“It’s clear that people want to invest in cryptocurrencies. They don’t want to sell their investments, and what we want to do is make that as easy as possible. So we have all of the above partnerships.”

As for stablecoins, Miebach noted that Mastercard is “engaging with private sector players as well as regulators to discuss what good policy looks like around private sector stablecoins, as questions remain about regulatory compliance.”

Miebach then reiterated what he said during the company’s first-quarter earnings call, that Mastercard is “preparing to technically enable our network to support these stablecoins as settlement currencies, as long as they meet one of our — all three of our criteria, which is regulatory compliance, consumer protection, and stability.”

Regarding central bank digital currencies, he noted that more and more central banks are exploring CBDCs, including the European Central Bank (ECB) and the Bank of England. The executive believes:

"Things are definitely continuing to move forward ... there is clear progress."

In response to a question about Mastercard’s value proposition to central banks and governments in the cryptocurrency space, the CEO said, “We bring a unique perspective to the market… As a multi-track provider, we bring a unique perspective to these players because all of these countries have to make trade-offs.” He argued:

“Everyone has different motivations, it could be financial inclusion, it could be cross-border payments, so we are the welcome party because we have experience in all of those.”

Specifically, he noted, “I think a particularly key proposition here is our virtual testbed because all these design choices that governments have to make, and we consult with them, and then we have to navigate this with zero experience. They have to work with existing financial infrastructure, and that’s what our virtual testbed does for them.”