Mastercard, Borderless Test Shared Identity Checks for Stablecoin Transfers

Payment processor Mastercard and stablecoin orchestration network Borderless will run a new pilot project to explore how Mastercard’s Crypto Credential standards-based framework can bring greater trust to cross-border stablecoin payments.

The pilot will test how Mastercard’s framework can address the challenge of providing assurance signals that participants can incorporate into their approval, compliance and risk processes, they said in an announcement shared with Cointelegraph.

Mastercard’s framework uses common standards and assurance signals to help bring certainty to blockchain transactions. The pilot will seek out new governance signals that can reduce friction in cross-border stablecoin payments.

Compliance remains one of the biggest friction points for stablecoin payments, according to Kevin Lehtiniitty, CEO and co-founder of Borderless. “Correspondent banking solved this decades ago: originating compliance trusted downstream, no re-execution at every counterparty. Mastercard is applying that model to digital asset payments,” he explained. 

Mastercard’s Crypto Credential will act as a governance and verification layer, but Mastercard will not process or settle funds as part of the pilot, he told Cointelegraph.

The pilot marks Mastercard’s latest push into the stablecoin industry, coming just after the payments giant completed its acquisition of stablecoin infrastructure company BVNK on Monday, in a deal valued at $1.8 billion.

In June, Mastercard announced plans to expand its settlement capabilities to include intraday, weekend and holiday card settlement, including settlement through stablecoins including Circle’s USDC, Paxos-issued PYUSD, USDG and USDP, Ripple’s RLUSD and SoFi’s SoFiUSD.

Magazine: How Mastercard plans to settle card payments with stablecoins

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