Soon after announcing the creation of a global startup engagement program dedicated to digital assets, blockchain, and cryptocurrency companies, Mastercard CEO Michael Miebach discussed the company’s fintech future on the company’s Q2 earnings call. In particular, he laid out the company’s strategy on CBDCs, stablecoins, and cryptocurrencies more generally, noting that the company planned to engage in all three sectors.

“Right now, many bureaucrats view CBDCs as a way to stymie the emergence of stablecoins. It is interesting that Mastercard views all three segments --- CBDCs, stablecoins, and cryptocurrencies --- as a centerpiece of a strategic objective in the digital payments space. What that says is that the company sees value in each segment, and, while CBDCs are definitely moving forward as a gamechanger in finance, there is still a place for all of the new innovations associated with blockchain technologies --- including those which surely haven’t even yet emerged,” opined Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.

“We also said in the first quarter call that as far as stablecoins are concerned, we are getting ready to technologically enable our network to carry these stablecoins as settlement currency, provided they meet one of our - all three of our criteria, which is regulatory compliance, consumer protection, and stability. So, none of that has changed… nothing much different, other than up engaging with private sector players as well as regulators on what does good policy look like around private sector stablecoins because this question about regulatory compliance is still unresolved and regulators do need to weigh-in and we're a part of that dialog.,” Miebach stated on the call.

“What’s intriguing about Miebach’s commentary on stablecoins is the emphasis on regulatory compliance. Obviously, a company like Mastercard is going to be very interested in staying compliant, but that he made special note of it within the call, and that’s a signal that players across fintech should be looking more at their own compliance strategy. I’ve long believed that the biggest thing holding digital assets back is a fragmented approach to compliance. Regulatory guidance and compliance really are key,” Gardner said.

“[O]n the Central Bank digital currency front, things are definitely continuing to move forward. We see a lot of central banks engaged on the topic. The ECB has just recently announced that they will actually move forward with the digital euro after a period of industry consultation,” Miebach noted.

“For only two sentences, there’s a lot to unpack here. CBDCs are rising, and it seems like every day that another central bank is committed to launching a CBDC. It isn’t a trend. It’s a looming certainty. There’s no time left to wait and see. The time to prepare is now,” said Gardner.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Over the past twenty years, the company has built technology for the world’s most notable exchanges, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“On falling cryptos here, the point of currency stability is not solved. So, we won't be enabling that as settlement currency on our network, but clearly people want to invest in that and want to sell their investments and we're going to make this as easy as possible,” Miebach said.

“Miebach’s commentary is in response to questions asked on the call, but it really doubles a response to those naysayers who said that cryptocurrency’s resurgence earlier this year was only a blip, and that it was going to crash once and for all. Mastercard’s investment into the segment is in categorical opposition to that theory,” said Gardner.