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SoFi Bets $25 Billion on Putting Stablecoins Behind the Card Swipe

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SoFi Bets $25 Billion on Putting Stablecoins Behind the Card Swipe

Consumers and merchants were supposed to be the silver bullet driving scalable digital asset adoption. The cryptocurrency industry is mature enough for that to have already happened by now, and it hasn’t.

However, news from Mastercard and SoFi Technologies announced Tuesday (Sept. 22) showed that the FinTech and payments industry isn’t giving up on digital assets and stablecoins. The two companies are now using stablecoin settlement across SoFi Bank, N.A.’s debit and credit card program, with SoFi Bank migrating its entire $25 billion card program to stablecoin settlement of transactions. The program uses SoFiUSD, a U.S. dollar-backed stablecoin issued by SoFi Bank, together with Mastercard’s global payments network.

SoFi’s launch wasn’t alone this week, either. Thredd announced Wednesday (Sept. 23) that it is expanding its issuer processing platform to include stablecoin-powered money movement capabilities, with the initial rollout centered on supporting B2B and B2B2B applications, such as stablecoin-backed card programs, cross-border payouts, global treasury flows and on-chain settlement.

Taken together, the marketplace news reveals that, rather than relying on consumer adoption, the financial services space is now testing whether the bigger blockchain opportunity is to leave the payment experience untouched and replace the last-mile infrastructure after authorization but before final settlement.

Take that one level further, and stablecoins start looking less like competitors to cards and more like competitors to some of the correspondent banking, prefunding, treasury and settlement machinery underneath cards.

Read also: Why Stablecoins Are a Money Story, Not a Consumer Story

Payments technologies typically face an adoption problem before they face a technology problem.


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