Mastercard: Stablecoin speed capped by slow fiat on-ramps

Mastercard executives warn that the speed advantage of stablecoins is frequently negated by slow connections to traditional banking systems. Matthew Driver, executive vice president of services for Asia Pacific at the payments firm, told CNBC on Monday that a fast middle layer is useless if the start and end points are slow.

Driver described the issue as a 'stablecoin sandwich,' where a rapid digital transaction is bracketed by sluggish on-ramps and off-ramps. He noted that while stablecoins pegged to assets like the U.S. dollar offer efficiency for remittances and less common currency pairs, the overall transaction time depends on the infrastructure at both ends.

To fix this, Driver said real-time payment systems must connect directly to stablecoin exchanges. He emphasized that market participants need better infrastructure to use the technology effectively. The firm is pursuing this through its acquisition of BVNK, a stablecoin infrastructure provider, a deal that closed in August.

In Singapore, Driver observed that retail payments are already highly efficient, limiting stablecoin utility for consumers. However, he identified corporate payments as a stronger opportunity, particularly through smart contracts that execute transactions only when specific conditions are met. Interest in these tools has grown since the passage of the U.S. GENIUS Act.

This week, Mastercard and BVNK launched the Global Money Platform. The tool allows banks, fintechs, and businesses to manage payments across traditional currencies and stablecoins through a single API. Driver stated the company is also integrating blockchain and identity data to build trust in these new systems.