Mastercard, Voyager Team on USDC Stablecoin

“We live in a world of digital money.”

Steve Ehrlich, CEO of the Voyager Digital cryptocurrency platform, told Karen Webster that as the use of cash declines and consumers use credit and debit cards to transfer money. money electronically, the stage is set for wider adoption of cryptocurrencies for everyday spending.

The desire to do it is there. As PYMNTS research has shown, up to 18% of the US population would like to use cryptocurrency to make a purchase.

Read more: BitPay Study: How Consumers Want to Use Crypto to Buy and Pay in 2021 and Beyond

On Tuesday, November 16, Voyager announced the availability of a partnered debit card with Mastercard that the company says generates high returns on the crypto assets held by the company – in particular, USDC stablecoins – that can be spent. like money everywhere debit. Mastercard is accepted. Unique to the new Voyager card will be its use of a stablecoin while offering annual rewards to all participating customers.

As for the mechanics of the Voyager debit card, users are rewarded by holding balances and receiving USD coins in their accounts, in addition to a 9% return. The card comes with unique routing and account number, giving users the ability to use features like automatic bill payment, direct deposit, and ATM deposits and withdrawals.

“This will provide our consumers – and future customers – with a debit card linked to their USDC balances held at Voyager,” Ehrlich said. “Cardholders can earn their annual rewards which are paid monthly by holding USDC with us, but then use that debit card wherever Mastercard is accepted. You can spend as if you were using a card from a traditional bank.

The Stablecoin advantage – and the mechanics

Stablecoins are in their infancy, but are rapidly gaining adoption. Circle recently noted that there was $ 33 billion in USDC in circulation. And with a nod to the ongoing regulatory picture, Ehrlich noted that the frameworks and standards will help digital assets become more widely adopted as a payment mechanism. “Thoughtful regulation could be very powerful in the adoption phase here,” he told Webster.

In terms of mechanics, cardholders swipe the debit card or spend online, and Voyager does “all the backend work” that takes the USDC, turns stablecoins into dollars, and pays the seller into fiat. The new card makes Voyager the first crypto company to fully integrate USDC into the trading market, Ehrlich said – and it resolves a sticking point for cryptos and stablecoins in general.

As Ehrlich noted, consumers want to be able to spend their USDC holdings and tend to want to keep their bitcoin earnings. Bitcoin holders generally want to keep this reputable crypto name, seeing bitcoin as a less spendable asset than a store of value and long-term growth.

Bitcoin is also less attractive as a payment choice, Ehrlich said, due to capital gains taxes because this tax event is not levied on stablecoins, which trade at par with fiat.

Embrace the yield

And, Ehrlich added, cryptocurrency holders want a return on their holdings – in an environment where the bank is not giving them a return (at the time of writing, the average deposit account held with a bank earns a few basis points per year).

The installed base is there to leverage stablecoins in daily spending, he maintained, adding that Voyager has $ 6 billion in assets on its platform. He explained to Webster that Circle and Voyager are no strangers to each other.

Last year, Voyager purchased the Circle Invest digital asset investing app and integrated some of its functionality into its platform. As part of the acquisition, Voyager acquired 40,000 retail accounts from Circle. Ehrlich observed that 2.7 million platform users interact with the app, on average 10 times per day, along with one million funded retail accounts, indicating an entirely new opportunity.

This critical mass, he said, “probably puts us in the top two or three crypto players in the United States – just for retail consumers.”

In an effort to expand the stablecoin / commerce ecosystem, Voyager pays this 9% return on USDC holdings as “marketing expenses” funded by Voyager’s trading activities and associated trading income, and there is also a rewards program. Voyager offers holders of certain crypto assets and tokens “additional” USDC rewards.

Call it “fertilizer” for opening and developing new retail accounts, Ehrlich said, and educating consumers about the benefits of using stablecoins, linked to rewards programs, to complete transactions.

Wider exposure comes from the fact that debit / stablecoin cards can be used at ATMs, for bill payment (the bill payment feature is on the company’s roadmap), in-store or online. .

Voyager, Ehrlich said, strives to be “the digital asset-based financial app” – connecting digital wallets, platform and debit card. “We believe that USDC and these types of debit accounts are going to revolutionize the way people view their money and change the way they use and get rewards on their money,” he told Webster.