Mastercard says stablecoin speed depends on fiat conversion speed

Mastercard executive Matthew Driver says stablecoins face a structural barrier that prevents them from becoming universally faster payment tools. Driver, the executive vice president of services for Asia Pacific at Mastercard, told CNBC that the technology offers promise for specific use cases. He identified remittance corridors and less commonly traded currency pairs as areas where stablecoins could be attractive. However, he warned that the full potential of these assets remains unrealized without improved supporting infrastructure.

Driver described a problem he calls the "stablecoin sandwich." This term refers to a transaction structure where the initial step of moving money into a stablecoin is slow. The middle step, the actual transfer on the blockchain, is fast. The final step of converting the stablecoin back into fiat currency is also slow. According to Driver, this pattern means the overall process does not necessarily translate into faster payments for the user.

To fix this, Driver said real-time payment systems must connect directly to stablecoin exchanges. He emphasized that market participants need the ability to use the technology effectively. He noted that opportunities for adoption vary by market. In Singapore, retail payments are already efficient, so stablecoins may have fewer applications in consumer transactions. Corporate payments, however, present greater opportunities. Driver cited smart contracts as a potential use case, allowing transactions to execute automatically when specific conditions are met.

Interest in stablecoins has grown since the establishment of the U.S. GENIUS Act. Mastercard is expanding its role in digital assets to support this trend. The company completed its acquisition of stablecoin infrastructure provider BVNK in August. Earlier this month, Mastercard and BVNK launched the Global Money Platform. This tool allows banks, fintechs, and businesses to manage payments involving traditional currencies and stablecoins through a single application programming interface. Driver added that Mastercard aims to use blockchain and identity data to build trust in these new systems.