Mastercard Exec Skeptical About Stablecoin Adoption Despite Benefits

Mastercard’s Chief Product Officer, Jorn Lambert, has expressed skepticism about the mainstream adoption of stablecoins, despite the technology's potential. During a recent call with analysts, Lambert highlighted the technical advantages of stablecoins, such as fast transactions, 24/7 uptime, low fees, programmability, and immutability. However, he emphasized that these features alone are insufficient for stablecoins to become a viable option for everyday payments.

Lambert pointed out that for stablecoins to gain widespread acceptance, they need to offer a seamless user experience, broad accessibility, and extensive consumer distribution. He noted that currently, about 90% of stablecoin usage is tied to crypto trading rather than consumer purchases. Companies like Coinbase and Shopify have made efforts to enable stablecoin payments for everyday goods and services, but significant barriers remain, particularly in user adoption and checkout friction.

Lambert compared existing stablecoins to prepaid cards, with limited functionality for peer-to-merchant payments. He suggested that stablecoins are often seen as a way to bypass card networks and avoid transaction fees, but Mastercard and other payment giants are positioning themselves as essential partners. They aim to increase stablecoin utility by integrating them into established payment systems.

Mastercard’s Chief Commercial Payments Officer, Raj Seshadri, added that stablecoins have hidden complexities. He noted that converting to and from fiat currency adds costs, including the price of the stablecoin itself, foreign exchange rates, regulation, settlement, and infrastructure.

Despite these challenges, some experts hold differing views. Federal Reserve Governor Christopher Waller recently stated that stablecoins could enhance competition in the payments system, making payments cheaper and faster. He emphasized the importance of competition in driving down costs for households, consumers, and businesses.

As stablecoin regulation gains traction in the US, financial institutions are increasingly considering their role in this evolving landscape. Regulatory clarity is prompting some to explore offering stablecoins or deposit tokens to retain deposits that might otherwise flow into digital wallets. Lambert noted that every financial institution evaluates whether it needs to issue stablecoins and what the right product-market fit might be, with many focusing on avoiding a loss of control over customer deposits.

Beyond the private sector, governments and central banks are also taking a closer look at digital currencies. They aim to support innovation while preventing dollarization in their domestic economies. Lambert expects a wide range of approaches to emerge globally as the crypto industry moves closer to mainstream adoption.