Crypto: Mastercard Adds Sofiusd As Settlement Option For Card Issuers

SoFi will enable Mastercard issuers to settle card transactions in its cash-backed SoFiUSD stablecoin across the global payments network.

SoFi Technologies has partnered with Mastercard to enable settlement in its dollar-backed stablecoin, SoFiUSD, across Mastercard’s global payments network, allowing issuers and acquirers to settle card transactions using a bank-issued digital dollar.

Under the agreement, SoFi Bank N.A. plans to settle its own Mastercard credit and debit transactions in SoFiUSD, while SoFi’s payments technology platform Galileo will give client banks and card issuers the option to use the stablecoin for transaction settlement across the number two processor’s network.

The company said SoFiUSD is the first stablecoin issued by a US nationally chartered and insured deposit bank on a public, permissionless blockchain and would allow transactions to be settled 24 hours a day, seven days a week across Mastercard’s network.

SoFiUSD, launched in December, is issued by SoFi Bank, an OCC-regulated insured depository institution, and is backed 1:1 by cash reserves. Mastercard’s Multi-Token Network is expected to support the stablecoin alongside fiat currencies, tokenized deposits and other digital assets.

The companies said they will also explore additional use cases, including cross-border remittances, business-to-business transfers, programmable treasury applications and stablecoin-enabled card programs, subject to regulatory requirements and Mastercard network rules.

The move comes as Mastercard has been increasingly active in the stablecoin space. In November, the company partnered with Thunes to expand stablecoin wallet payouts through Mastercard Move, enabling near real-time transfers to regulated stablecoin wallets via Thunes’ Direct Global Network.

Related: SoFi reports record Q4 revenue as crypto trading resumes late in quarter

Mastercard is not alone in integrating stablecoins into its payments infrastructure, with biggest processor Visa also widening its use of digital dollars across settlement and payout services.

In September, Visa began testing stablecoin-based cross-border settlement, launching a Visa Direct pilot that allows select banks to pre-fund international transfers using Circle’s USDC (USDC) and (EURC). The payments giant later expanded support to four stablecoins across four blockchains, enabling conversion into more than 25 fiat currencies.

Source: CoinTelegraph