Key message: People, who have a Mastercard and own cryptocurrencies, will be able to pay with their cryptocurrencies wherever the company’s cards are accepted. Mastercard and Circle with its USDC stablecoin have announced a pilot program for that.

Mastercard and crypto payments

Stablecoin USDC would serve as an intermediary between fiat currencies and cryptocurrencies. This would allow all merchants to offer card payments, with the understanding that they themselves would only transact in fiat. For many cryptocurrencies, it is easier to convert them to stablecoin than to fiat. Stablecoin is a cryptocurrency pegged to fiat with a promise of a refund any time at a 1:1 ratio to that pegged fiat, so it is less volatile. Therefore, they are useful intermediaries in transactions.

In the words of Executive Vice President Raj Dhamodharan, not all crypto companies have the basic infrastructure to convert from cryptocurrencies to fiat. Hence, the partnership will facilitate this transfer.

On July 20, 2021, Circle unveiled the exact breakdown of the USDC’s support. 61% is cash and cash equivalents, and in the case of USDC it is US dollars. The mix of non-U.S. bank certificates of deposit is 13%. The full 12% is U.S. Treasury bonds, commercial paper accounts are 9% and the remainder is municipal and corporate bonds.

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Source: forkast.news