Mastercard Forms Digital Assets-Focused Partnerships With Fiserv and Chainlink

Mastercard has announced two separate partnerships involving digital assets.

In one collaboration, Mastercard and Fiserv have partnered to explore ways Mastercard’s global payments network can integrate Fiserv’s new stablecoin, FIUSD.

In the other, Mastercard and Chainlink have teamed up to enable cardholders to purchase crypto directly on-chain.

Mastercard’s collaboration with Fiserv will enable individuals and businesses to use FIUSD across more than 150 million merchants, the companies said in a Tuesday (June 24) press release.

“This work with Fiserv is setting the stage for a new era, where stablecoins are as ubiquitous and trusted as fiat currencies, driving choice and innovation for all,” Chiro Aikat, co-president, Americas at Mastercard, said in the release.

The areas in which the companies see opportunities for stablecoin adoption and utility include seamless on- and off-ramping that will allow smooth transitions between fiat and FIUSD, enabling FIUSD as a settlement option for global acquirers so merchants can get paid in FIUSD, and connectivity to the Mastercard Multi-Token Network (MTN) so Fiserv’s Digital Asset Platform can bring off-the-shelf support for programmable on-chain commerce to banks, according to the release.

Mastercard and Fiserv will also enable the issuance of stablecoin-linked cards so consumers and businesses can make FIUSD payments anywhere Mastercard is accepted and, with Mastercard One Credential, choose the payment type of their choice, including debit, credit and stablecoin balances, per the release.

“To date, stablecoins have largely been a store of value,” Takis Georgakopoulos, chief operating officer at Fiserv, said in the release. “Our work with Mastercard is promoting greater reach and utility of stablecoins by helping our financial institutions and merchants enable greater payments choice to their customers.”

Fiserv said Monday (June 23) that it plans to launch a digital asset platform that includes the FIUSD stablecoin that will be added to the company’s banking and payments infrastructure by year’s end.

The company said that offering FIUSD across Fiserv’s network, which includes relationships with roughly 10,000 financial institutions and 6 million merchant locations worldwide, will “provide instant scale for FIUSD while creating a digital asset network that clients can use to build new products and services.”

Mastercard has been exploring stablecoin payments and other digital asset innovations as a way to deliver on the emerging digital expectation layer consumers have come to prefer, Raj Dhamodharan, executive vice president, blockchain and digital assets at Mastercard, told PYMNTS in an interview posted in May.

“For consumer adoption, most people won’t even know they’re using stablecoins,” Dhamodharan said. “In the U.S., there’s already a robust electronic infrastructure of wallets, bank accounts, etc. Crypto-native users may interact directly with blockchain, but most won’t. The real utility for them comes through simple experiences, like using a card linked to a stablecoin account.”

Mastercard’s partnership with Chainlink, which was announced in another Tuesday press release, brings together Mastercard’s global payments network and Chainlink’s interoperability infrastructure to allow payment cardholders worldwide to purchase crypto assets directly on-chain through a secure fiat-to-crypto conversion.

This collaboration also includes on-chain service and liquidity from Zero Hash and integration support from Shift4 Payments, Swapper Finance and XSwap, according to the release.

“There’s no doubt about it — people want to be able to easily connect to the digital assets ecosystem, and vice versa,” Dhamodharan said in the release. “That’s why we continue to leverage our proven expertise and global payments network to bridge the gap between on-chain commerce and off-chain transactions.”

Chainlink Co-founder Sergey Nazarov said in the release that this offering will connect Mastercard’s three billion cardholders with the trading environments offered by on-chain decentralized exchanges.

“This is the type of traditional finance and decentralized finance convergence that Chainlink was built to make possible,” Nazarov said.

Simplifying blockchain usability is essential for scaling blockchain use cases beyond crypto-native communities, Dhamodharan told PYMNTS in an interview posted in November.

The technology’s mainstream adoption has been hampered by the technological knowledge required to navigate it, Dhamodharan said.

“Blockchain technology, and public blockchains in particular, are opening up a number of new use cases, one of which is to transfer value — such as remittances — from one country to another,” Dhamodharan said. “But while the underlying infrastructure enables you to transfer value, it doesn’t really lend itself to doing so in a very easy way.”