Crypto Meets Cards: Shaping the Future of Commerce Featuring Ivan Soto-Wright & Sherri Haymond | Permissionless IV Fireside Chat | Bonus Episode

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You guys are both upstaging me on the looks. You guys are both looking better than me. This is not great. All right, so the first thing I want to talk— so this is a very crypto-native event, and we've got a lot of crypto companies. It's exciting to be graced by Mastercard's presence here. Shira, I think I'd love to hear maybe just your story of— I mean, this is not— you guys have not— you didn't just enter the industry, you know, 2 months ago or 3 months ago. I feel like we see a lot of enterprise companies, you know, genius passes, stablecoins are hot. There's a lot of people sprinting to spin up a stablecoin strategy. You guys have had this strategy for a while. Tell, tell me the story here.

Yeah, so we, we've actually been building in the space for years now. So at Mastercard in general, our, one of our kind of core philosophies is choice. We like to be where our customers want to be, both consumers, you know, merchants, businesses, and kind of early on we saw a lot of potential with blockchain and crypto at the time that we started, not really stablecoin, right? But, but that evolved to, to be part of the picture, an important part of the picture. And the idea is that like our network, we've always been actually a multi-rail network, right? We have all kinds of payments on our network. We have, we have payments that allow people to purchase things. We have push payments that allow you to get send money back and forth, right, between friends. We've integrated account-to-account payments. We have mobile money wallets connected to our network. Like all different kinds of things are connected, and we want to always enable whatever our customers want to, want to choose. And so from very early on, you know, a whole bunch of years ago, we started doing projects and partnerships with various players in the industry, including MoonPay. Which was kind of actually a partnership that started a bunch of years back. But we've developed a whole bunch of commercialized products and services that like leverage blockchain and stablecoin that have been live for quite a while now. And now we're just, you know, building on that. And with the clarity that's coming now, we expect that will obviously continue.

Yeah, maybe Ivan. So when I think of MoonPay's business, I think of being the onboarding role onboarding rails for the industry. You guys do have more product lines than that. Where do stablecoins fit into MoonPay's whole business?

Yeah, so we're working to onboard the entire world to crypto. It's a giant project, which is complex because you have to think about every single point of distribution. It's across a bunch of different geographies. How do you do that within regulatory compliance? And how do you really build a very seamless user experience? When we started the business, really the, you know, first thing that we thought about was these wallets are going to become really important. These wallets are essentially almost going to be like a next generation version of a bank account. If you have an internet connection anywhere in the world, you can spin one up and essentially you're going to want to build that backwards compatibility to the existing financial system so people can use the debit cards that are in their pocket to immediately come into this new ecosystem. Stablecoins are the word that's en vogue right now. I think this year you can't go, you know, you can't go like 2 minutes without hearing someone say the word stablecoins. You know, I think there's a lot of reason behind that hype and there's really, you know, where, where we're at is I think we're in the enabling phase of seeing businesses all around the world ask what are the solutions that we can offer to our customers? I think the first step of that is from on the infrastructure side, what we're starting to see in real time is customers are wanting really cheap, easy, efficient access into stablecoins. And so we're also finding that partners are looking for more APIs, more, more white label embedded solutions. And so early this year, we acquired this company called Iron, and it was really around, let's build developer-first infrastructure to make it easy for any business to plug in, to be able to spin up a virtual account, to be able to receive money into that virtual account, instantly redeem it into a stablecoin, build an orchestration layer where we could do it across a whole range of different stablecoins. And, you know, this is probably the most exciting area for our business because what we're also seeing with the crypto natives and the crypto wallets that we partner is they want to ultimately bring all that functionality that you can have inside of a bank account. You want to be able to receive a salary deposit immediately if you're a contractor in somewhere like Argentina, receive a salary deposit in US dollars, automatically have that converted into stablecoins, and then you're going to be able to access the entire world of crypto. You'll be able to earn yields, you'll be able to— invest in any asset on the blockchain. And so we're really excited to accelerate that and make that happen.

Maybe we can talk about the partnership between you guys, 'cause I think maybe some people have seen the news announcements and they think, oh, there's this new partnership between MoonPay and Mastercard, but really you guys have been at it for years. I'm curious, I mean, I've personally seen many crypto-to-enterprise partnerships fail over the years, and it seems like this one's actually working very well. So what, what makes this partnership work so well, would you guys say?

So I guess talk about the first steps. The first step of Mastercard, obviously the, the saying and the marketing slogan is priceless and priceless experiences. We had an opportunity to work very closely together with the team around thinking about blockchain initiatives. We started with Web3 Priceless. And so essentially rewards, how do we put rewards on chain? And so we've been working with the Mastercard team, implementing it inside of some of the most important marketing properties of MasterCard over the last couple years, golf tournaments, and we've seen some really interesting engagement. I would say that was definitely more on the experimentation angle. I think now what we're really starting to see is there's real demand in the marketplace for stablecoins. And so how do we enable businesses around the world to be able to spin up virtual accounts? And if you think about it, the next step for them is you have a virtual account, you'll have a crypto wallet that underpins the foundational layer. Of the financial infrastructure, how do we spin up cards? How do we make, you know, how, and, and so if we think about that as a next step, you want to be able to take these stablecoins that you have in a wallet, spend it anywhere where Mastercard is accepted. And so a lot of the work is, you know, working closely with Mastercard to see more Mastercard adoption on traditional rails, but also to bring that compatibility with stablecoins themselves.

But then more on like why, why MoonPay Mastercard? So MoonPay, cares a lot about things that we care about. They care about choice, they care about trust. They spend a lot of time on compliance. Like, obviously we work with lots of regulated, we work with lots of kinds of companies, regulated, like regular, you know, businesses, merchants. But for banks in particular to want to work with us together with a partner, it matters a lot who the partner is and that they actually take the time and care and, you know, respect the licensing structure and all of the rules, regulations, etc., laws. And MoonPay really stands out in that for us in that regard.

Katana isn't another new general purpose blockchain. It's purpose-built for DeFi users to provide the best experience possible. It does this by sustainably generating deeper liquidity and higher yield than any other network. If your assets are sitting idle, then they're dead. Katana is built from the ground up with DeFi mechanics to bring your bags back to life. All you have to do is bridge over and Katana does the rest for you. Incubated by Polygon Labs and GSR, Katana launches with a notable ecosystem of primitives, assets, and partners like Morpho, Sushi, Vertex, Lombard, Chainlink, and Yearn. Be early to Katana. Join the pre-deposit campaign before mainnet opens at the end of this month. Deposit funds and open rewards filled with randomized amounts of KAT tokens. There's also a CryptoPunk and other exclusive NFTs hidden for the lucky ones. As always, investments in blockchain technology involve risk. Terms and conditions apply.

Jerry, how do you think about who is going to benefit most from Maybe like if you're painting a picture of the future, is it, uh, the emerging markets? Is it crypto natives? Is it regular consumers who don't even know what crypto is? Who, who's benefiting from this?

I mean, over time I think it's all those things, but initially, yes, crypto natives for sure. Um, but also people and businesses, gig workers, contractors, et cetera, who live and work in emerging markets or in markets that are high inflation, currency unstable. As Ivan was saying before, it obvi— and all of you in the room probably know this, it, it makes a lot of sense. I understand why people in those markets like want to be paid in a US dollar-denominated thing or in US dollars. And then if we can convert that to stablecoin, there's just, you can hold it easily and there's like a lot of utility that comes from that. Again, through attaching your card to it, you can spend it anywhere Mastercard is, it's, you know, accepted. And who knows what else we'll enable together in the future, bill pay and all other kinds of things.

Um, Ivan, I'm curious how you think about like the market for MoonPay. I would guess it's mostly been US-based. I don't, I don't actually know where your market is right now, but how do you think about this? I mean, there's been this idea in crypto of like, we're going to bank the unbanked, I think, or we're going to help, uh, you know, maybe help folks who've been underserved by the financial markets. How do you think about MoonPay's role in that?

Yeah. So when we first started, we actually really focused on crypto natives because we saw these non-custodial wallets and To me, the magic of a non-custodial wallet is you're in control and anyone with an internet connection can spin one up. And so if you think about the unbanked, there's 1.2 billion unbanked. 75% of the unbanked actually have smartphones. So, you know, I think for them, they may actually leapfrog the existing financial solutions that are out there. It's hard to get banking in all sorts of corners of the world. There's a connection to the internet and these guys have smartphones. So I think the logical step for them will be to adopt this technology. When we started, it was, okay, well, there are going to be these wallets. First step is I want to put money inside my wallet. And so when we built MoonPay, it was really thinking, okay, biggest distribution points, obviously the card networks, MasterCard being a really important partner in that. And now you can use your card and immediately put digital money in your wallet. You know, where we're going now, and as we start to see, you know, the market evolve, I think the total addressable market of crypto is growing. I think there's demand from businesses. and those businesses might not want a MoonPay widget, might not want a MoonPay SDK. They want, may want a fully headless white label API-driven experience. I also think what you're seeing with the advent of AI, AI doesn't really care about your UI. They're literally going to ruthlessly, you know, execute on APIs. And so a lot of our focus has really been on building the developer infrastructure, building the platform to make it really easy for businesses to integrate this technology.

Can you say more about your— I mean, this is kind of getting away from the topic of the panel a little bit, but just curious, Ivan, your vision for the future with like Agentic AI commerce and like the role of stablecoins in that?

Yeah, so I think they go hand in hand. I think stablecoins are going to be the payment method of choice of AI agents. Yeah, I think they are, you know, they're obviously internet native, and so it makes sense that there needed to be internet native currency for these AI agents to execute on. More trading activity inside of centralized exchanges and the rest, just exchange activity in general. I think we're going to see more and more activity happen in the form of an AI agent taking these actions on behalf of users. So I think we're in the first phase of AI, is really the read-only phase where we use AI to gain incredible insights about the market, to understand what's going on. I think the next step will be offering API keys and delegating access to these AI agents to do all sorts of things for you. And so I think that's the next frontier. Of commerce. I think it's changing very, very quickly. But I really see the future will be, you know, when you want to, you know, auto-ramp into a crypto asset or you want to take a particular view on the market, these AI agents will go and do that for you.

Yeah. Shery, from a Mastercard, like, business strategy perspective, do you think that you guys will get into stable— you guys are pushing into stablecoins and blockchain and stuff because the market is going to pull it out of you, or increases the TAM or why, why, why, why get into this?

Oh no, I mean, it, it definitely increases the TAM. But kind of where I started, you know, we, we really, there, there's demand for this. I mean, we, we anticipated that there would be demand. It actually took longer to kind of come to fruition than we thought because we've been at this for actually a while. We have a lot of people that work on this, like big team of, you know, crypto, digital asset, blockchain. And for a while they were just sort of like doing their thing and like, you know, excited about when the company would let them do a press release kind of thing. But, um, you know, now they're like the belle of the ball. Um, and so why we're doing it, I mean, it, I, it's, it's imperative that we're, that we're there. I mean, especially with Genius, you know, passing the Senate and yeah, that look being on a good path. Um, there's just a lot more clarity now. And so there's an expectation also on part of our customers that we're gonna be like very kind of well, like well-enabled to enable them. And this is something that, you know, banks are already asking about this. Like, you know, a few years back we launched something called Multi-Token Network and we've been, you know, tokenizing bank deposits for a while now. You know, it's not like this is most of the volume on our network that banks transact with each other in. But more and more you will see more banks, you know, kind of joining that platform and putting tokenized deposits on their platform, on the platform. Like if we weren't there for them to do that, those flows would move somewhere else. So of course, you know, it, it's like an obligation that we have, but it's also, there's a lot of innovation that, you know, that is happening right now and we're excited to be a part of it.

Nice. Right now, when anyone in this room uses stablecoins, you are very aware you are using a stablecoin because it is pretty clunky. How far away are we from using, from like mainstream consumers using stablecoins in the background, maybe without even realizing it?

So some of that's available. Some, well, without realizing it, more like, you know, that you're spending from a stablecoin balance. For example, if you're using a MasterCard to transact at the point of sale, So like in my mind, some of that's happening today. And in addition, like we, we settle on both sides of the network. Like if you are an issuer that wants to settle with us in stables, that's fine. If you're on the merchant and you want us to settle with you in stablecoin, that's fine. Like that's going on in the background and regular people probably have no idea. So some of that is, is available today, but how will you do it and not even know it? I feel like you'll know that you're. Somehow that you're holding, because you're making a choice to hold staples and not hold crypto or not hold fiat. Yeah.

Well, maybe that gets into how do you guys think about stablecoin-backed cards? And I mean, I know there's already—

We love them.

You love them. Yeah.

Well, I mean, actually also for a while now we've been doing, we've done crypto-denominated cards also that in facilitating conversion to fiat, um, for actually, you know, for spend at the point of sale. Um, but now with MoonPay, um, you know, stables are the star of the show with, uh, you know, as you connect bank accounts to wallets, um, and have balance held in stablecoin, we put, you know, a card in front of that, and then magically it also comes with all the consumer protections that we offer and like the I mean, merchant protections as well, like all of the, that trust, the security, et cetera.

Yeah, it feels like the dream user experience is spend. I don't, cause I don't want to spend my crypto. I want to spend my stables. Yeah. I want to spend my stables and have the stables sitting in some account getting, you know, 4% on treasuries, spend the stables and then get the rewards in crypto.

Katana isn't another new general purpose blockchain. It's purpose built for DeFi users to provide the best experience possible. It does this by sustainably generating deeper liquidity and higher yield than any other network. If your assets are sitting idle, then they're dead. Katana is built from the ground up with DeFi mechanics to bring your bags back to life. All you have to do is bridge over and Katana does the rest for you. Incubated by Polygon Labs and GSR, Katana launches with a notable ecosystem of primitives, assets, and partners like Morpho, Sushi, Vertex, Lombard, Chainlink, and Yearn. Be early to Katana. Join the pre-deposit campaign before mainnet opens at the end of this month. Deposit funds and open rewards filled with randomized amounts of KAT tokens. There's also a CryptoPunk and other exclusive NFTs hidden for the lucky ones. As always, investments in blockchain technology involve risk, Terms and conditions apply.

Oh, we have exciting things coming, uh, on that front. But what I'll say is, um, I think what's really interesting is if you think about how hard it was to build a neobank, if we even went back a couple years ago, like you would have to go into the, uh, region, get a banking support, you get an e-money account. Uh, you know, if you were a developer and you wanted to build, uh, a banking type experience, you know, there was a lot of operational complexity, uh, very costly to get up and running. Now you have this advent of this crypto technology that's relatively democratized, and it's very easy to go spin up one of these cryptocurrency wallets. And I think ultimately, if you think about the pipes of our banking infrastructure, a lot of it was not upgraded for the internet. It's decades, decades old. I think when you think about some of the best consumer fintech experiences, it's built on these legacy rails, and there's been Band-Aids to make the user experience feel instant or to feel better, right? In a lot of cases, they're using factoring or they're, They're doing things to make that experience feel instant. Now we actually have a technology layer that is instant, uh, and is blockchain driven. And so my, my whole take is over time, more and more transactions are going to settle blockchains, uh, over blockchains. More and more people are going to interact with these wallets that you're going to, they're going to be maybe completely invisible. You won't even know that there might be even there. Uh, but I really think wallets are the new communication layer for money. And so our job is, okay, for a user, you're going to now have this non-custodial wallet. I want to make it just like my interaction with my neobank. And so we need to upgrade it with those neobank capabilities. Virtual accounts are a really important part of that equation because now I can receive things like salary deposits. I'm going to be able to pay for bills with it. I can now automatically convert that into a stablecoin, uh, swap that into any crypto asset. And then I think the next step will be you'll want a card attached to it so you can spend it in everyday life. And then we're also going to see merchants adopt solutions where They will have wallets on the other side, and you'll be able to start paying with those native crypto assets. We're not there yet. And if you think about any technology, you know, it takes years, right, for people to move into a more efficient system. I talk about telecoms all the time. I think it's the best analogy because if you think about, uh, the way that we communicate long distance, it was very expensive. And then we saw the advent of Voice over the Internet Protocol. We saw Skype, we saw Zoom. We, most of the apps that you use now are using, uh, internet-based technology to communicate. Same thing's going to happen for money. So we have these legacy systems. They're not going away anytime soon. I think over time we're going to adapt and you're going to see wallets embedded more and more and more and more and more activity is going to be settled over these new networks. But our job is to bring that user experience, to make it really easy to enable developers to get these experiences up and running with as limited complexity as possible. And I think ultimately that will lead to more efficient outcomes for consumers.

Yeah, maybe stablecoins aside, Ivan, I'm curious, you're okay. So if all transactions end up moving on-chain, via stablecoins. What is your broader thesis for just the industry writ large right now? I mean, we first met in, I think, 2018, been building for several years. I'm curious here, like, if all transactions come on-chain, do you think— are equities coming on-chain? Stocks, bonds, currencies, commodities, does it all come on-chain? I'm curious to get your— haven't talked in many years, but curious to get your updated view of the future here.

So I have an agnostic, almost Switzerland-like view of this technology. I think We just have to leave it to the developers to build the best products and best experiences. When we think about the issuance of crypto assets, we have obviously the major network tokens, we have stablecoins across these different chains. Different chains have different advantages, right? Some are going to be faster, some are going to be more secure, some of them might be used for particular use cases. And we're seeing a whole emergence of these different chains. You know, I think from, from my perspective, the, the next big thing is on the issuance side, it's not just crypto assets, but we're going to tokenize everything in the real world. I think the problem that we had was, especially in the United States, which most of the world looks to in terms of regulatory clarity, we had no regulatory clarity, right? And I think the big question was, are these tokenized instruments, are they securities? Market structure, first we got to solve what is a stablecoin? How should it be backed? We've seen some of the issues when they're not actually backed by real US dollars. Uh, we've seen all sorts of, uh, hiccups as we've, uh, you know, enabled people to just go and build. I think we're now getting to a place where we're bringing more structure into it. But I think stablecoins are the first major enabler, right? And then from there, you're going to want to be able to trade into anything that is a financial instrument. I think the first, you know, the next evolution is really going to be around yields. So I now have a stablecoin. How do I earn yield on that? Does that yield pay me better than holding that deposit with a bank? That's going to be, I think, one really big area of innovation that we're already seeing in real time. People holding crypto assets and then staking and earning much higher yields than they might be earning with their bank account. How can they do that safely? Then the next logical step will be, oh, I want to offer access to tokenized stock, right? And especially if you think about in other parts of the world, we might not see, and we take it for granted in places like the United States, but if you're in a country that has incredible inflation, being able to receive US dollars, have US dollars that they can receive from anyone in the world, already a really big deal because they can start to combat inflation. And then what they can do with it, with this new crypto economy, I think we're just getting started, but you can imagine for someone to be able to get access to tokenized NVIDIA or tokenized any, name any stock, that's incredible opportunity for people to make their money work for them. And I think it's going to be this liquidity network that we already see inside of crypto, I think is quickly, and if you ask ChatGPT, actually asked it a couple weeks back, when do we think that global liquidity within the crypto economy is going to overtake things like US equities? Uh, it's saying, you know, I think within the next 3 years. So very interesting.

Wow. That's all the time we have. Ivan, Sherry, thank you so much and congrats on all the progress so far.

Thank you.

Thanks, bud.