Coinbase and Marqeta team up on stablecoin-backed cards

Coinbase will hold and convert stablecoins for card programs offered by Marqeta customers, as the companies expand their partnership to help businesses let customers spend stablecoin balances. Marqeta announced the collaboration on October 16, saying Coinbase will provide custody and currency conversion, while its Base blockchain will handle settlement.

A stablecoin is a crypto token designed to keep a steady value, often against a currency such as the US dollar. The companies say their service will serve both crypto firms and traditional businesses. They did not name the stablecoins the cards will support.

How will the card payments work?

Coinbase will hold the stablecoin balances and convert between digital assets and regular money. Marqeta will issue the cards, process payments and manage relationships with banks and card networks, according to the announcement.

Base, Coinbase’s blockchain, will provide the on-chain settlement infrastructure. The companies say businesses will be able to fund card programs around the clock, and cardholders will be able to spend from stablecoin balances at millions of merchants that accept cards. They did not give a launch date or disclose fees, The Block reported.

What does the deal add to their existing partnership?

The collaboration expands a relationship that already includes Marqeta issuing crypto-backed cards for Coinbase, The Block reported. The new arrangement is aimed at Marqeta’s wider enterprise customer base, rather than only Coinbase cardholders.

For businesses, the proposed setup combines stablecoin custody and conversion from Coinbase with card issuance and processing from Marqeta. That could let a company offer card spending linked to stablecoin balances without building each part itself. The announcement does not identify any businesses that have signed up.

When will customers be able to use the cards?

The announcement describes what the companies plan to offer, but gives no rollout timetable. It also does not say which markets will be served first or specify which stablecoins will be available.

Marqeta said it already issues crypto-backed cards for Coinbase. The new collaboration extends that work to stablecoin-backed programs for Marqeta’s enterprise customers. The companies have not shared further details about how customers will access the cards or what the service will cost.

References

• Coinbase will provide custody and currency conversion — investors.marqeta.com
• The Block reported — theblock.co