Stellar Adds Mastercard Crypto Credential Tool to Its Blockchain

Stellar Development Foundation is integrating Mastercard’s Crypto Credential solution into its blockchain network.

The credential, which helps verify interactions among consumers and businesses using blockchain networks, will be added to the Stellar ecosystem as the exclusive credentialing solution “to enable a range of secure, compliant use cases” for crypto wallet providers such as Coins.ph, Mercado Bitcoin, and Wirex, Stellar said in a news release Tuesday (Oct. 15).

“Today, the user experience of cryptocurrency transfers is still complex, which can create a barrier to adoption,” the release said.

“With Mastercard Crypto Credential, crypto remittances can be simply initiated using the recipient’s email address. Behind the scenes, Mastercard Crypto Credential ensures the destination is valid, that it can accept the selected digital asset, and complies with regulatory requirements.”

The credential, Stellar said, confirms interactions among consumers and businesses, offering some peace-of-mind that a user has met verification standards. It also adds trust and certainty to the process via the exchange of metadata, while supporting the exchange of information required for cross-border transactions.

The partnership will initially focus on enabling credentialing for remittances and peer-to-peer transfers, the release added. The companies will also explore how Mastercard’s services can be leveraged on the Stellar network, “opening doors for additional new and innovative applications of blockchain technology,” the release said.

PYMNTS examined some of the challenges of cryptocurrencies as a payment method earlier this year, noting that adoption remains limited in spite of jumps in crypto wealth.

“While bitcoin and other digital assets have made strides in being accepted by a growing number of merchants, significant hurdles remain in proving their utility and scalability — not the least of which is the same volatility that has created the rising cohort of over 170,000 crypto millionaires,” that report said.

The inherent volatility of crypto also makes these digital currencies less appealing as a stable medium of exchange. For businesses, accepting payment in a highly volatile asset presents risk to their balance sheets, as the value of the payment can swing dramatically between the time a transaction is made and when it is settled.

“Regulatory uncertainty also continues to cast a shadow over the adoption of crypto as a payment method,” that report said. “Governments and financial regulators around the world are still grappling with how to classify and regulate cryptocurrencies. This uncertainty makes businesses hesitant to embrace crypto payments, fearing potential legal and compliance risks.”