Mastercard stated that stablecoins could offer faster and more efficient payment methods, but further improvements to the underlying infrastructure are still needed to unlock their full potential.
Matthew Driver, Executive Vice President of Mastercard's Asia-Pacific Services, told CNBC that stablecoins, a class of cryptocurrencies designed to maintain value stability by pegging to assets such as the U.S. dollar, may be attractive for certain remittance corridors and less actively traded currency pairs.
Driver said, "You wouldn't want a 'stablecoin sandwich.'" He meant that the entry into stablecoins is slow, the intermediate transaction is fast, and exiting back to fiat currency is slow again. He noted that this doesn't necessarily translate to faster payments.
He said that connecting real-time payment systems with stablecoin exchanges on both ends of a transaction could help accelerate payment speeds, but "you still need to build the infrastructure." He also added that market participants need to be able to use this technology effectively.
Driver noted that opportunities for adopting stablecoins may vary across different markets. In Singapore, retail payments are already highly efficient, so the use of stablecoins in consumer transactions may be limited, while corporate payments could offer greater potential.
He also mentioned that smart contracts could be a potential use case for corporate payments, enabling transactions to be automatically executed when specific conditions are met.
Driver noted that interest in stablecoins has increased following the enactment of the U.S. GENIUS Act.
His comments come as Mastercard expands its involvement in the digital assets space, including the acquisition of stablecoin infrastructure provider BVNK, which was completed in August. Earlier this month, Mastercard and BVNK launched the Global Money Platform, designed to help banks, fintech companies, and enterprises manage payments involving traditional currencies and stablecoins through a single application programming interface.
Driver stated that, in addition to payment speed, Mastercard is also seeking to integrate blockchain and identity data to establish trust mechanisms on par with other payment systems.