What are stablecoin-backed corporate cards and how do they work

Stablecoin-backed corporate cards are payment cards linked directly to digital wallets holding stablecoins—cryptocurrencies pegged to assets like the US dollar (e.g., USDC)—rather than traditional bank accounts or credit lines.

These cards enable businesses to make transactions in fiat currency while retaining their cryptocurrency holdings, by converting stablecoins into local fiat currency instantly at the point of purchase.

How They Work

Funding the Card: Businesses top up their corporate cards with stablecoins by depositing funds into either custodial wallets (managed by third-party platforms like Bridge) or self-custodial wallets (where users maintain full control).

Initiating Transactions: The card is used like a regular payment card—tapping or swiping at point-of-sale terminals or via digital wallets such as Apple Pay and Google Pay.

Real-Time Deduction: Stablecoins are deducted from the user’s wallet in real time.

Stablecoin-to-Fiat Conversion: The platform converts the stablecoins to the local fiat currency immediately behind the scenes.

Transaction Settlement: Visa’s global payment network processes the transaction, ensuring merchants receive fiat currency while users spend crypto seamlessly.

Types of Stablecoin-Backed Corporate Cards

Custodial Models: Third-party platforms hold and convert funds on behalf of users, simplifying the process but requiring trust in the custodian (e.g., Bridge).

Self-Custodial Models: Users retain full control of their funds, with transactions authorized through smart contracts that enable direct blockchain spending without intermediaries.

Key Features and Advantages

Global Acceptance: Usable at over 150 million merchant locations worldwide via Visa’s network.

Financial Inclusion: Provides access to global commerce for businesses in regions with unstable currencies or limited banking infrastructure.

Efficiency: Lower fees and faster transaction settlements compared to traditional banking.

Transparency: Real-time expense tracking and reporting.

Security: Enhanced fraud protection through blockchain cryptography.

Flexibility: Supports contactless payments via digital wallets.

Real-World Applications

• Simplifying business expense management, travel, and subscriptions.

• Facilitating quick, low-cost payroll and contractor payments, especially for remote teams.

• Enhancing treasury operations by enabling direct spending from crypto reserves without manual conversions.

Industry Adoption

Visa has partnered with companies to mainstream stablecoin-backed corporate cards, bridging blockchain assets with traditional financial systems. Other firms are also launching similar cards aimed at improving cross-border transactions by reducing settlement times, fees, and currency volatility risks.

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