Mastercard's HUGE Crypto & Stablecoin Initiatives Revealed! with Raj Dhamodharan

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Yeah, look, it's to be quite excited about this, and
the market has received this really well. And the whole
thing started with, you know, our own kind of looking
at even some of the people and the team and
now trying to kind of send money using blockchain. We
are pretty blockchain native users, we would like to say,
some of us on the team. Trying to send money
to another person is quite conversion even today for most cases.

Speaker 2 (00:24):
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devices and services, visit the link in the description. Hey, folks,

(01:29):
welcome into the Thinking Crypto podcast. I'm your host, Tony Edward,
and joining me is Rog de Moojoren, who is the
executive vice president of Blockchain and Digital Assets at MasterCard. Rog.

Speaker 1 (01:40):
Great to have you, Tony. It's great to be here
as well.

Speaker 2 (01:44):
I am so excited to speak with you MasterCard being
the payments giant that it is delving into blockchain and
building some unique products and services. And I have a
lot of questions for you, but before we get there,
tell us a bit about yourself and your professional background.

Speaker 1 (02:01):
Yeah. Look, first of all, it's great to be here,
and it's a great time to be in crypto at
the moment. And I think it is also wonderful to
be part of a such a celebrated brand and the
company Mastercut. We have a strong history of technology based
innovations in the space and look forward to kind of

(02:24):
talking about that a little bit more about myself. I've
been with the company for about fifteen years now and
different roles and Mastercut is great that way in terms
of building people pursuing people career in different sectors. I
used to be in our Asia Pacific region for a
while and yeah, I'll have a lot longer payment background

(02:45):
and also live in the Bay Area, so I have
a doublegateory startup background as well prior to all this,
which is also helping us navigate this sector because this
is quite dynamic and you got to you got to
get into it if you will.

Speaker 2 (03:01):
Yeah, absolutely, So I often ask people, you know, what
was their first encounter with bicoin or crypto or blockchain
and what was the aha moment? When did it click
for you?

Speaker 1 (03:12):
Wow? Look, I come from a bit of a technology
background and often often when new stuff comes in, whether
that is a crypto or AI, you tend to kind
of play around with it, and that's how you get
to get into get into it first of all, first
as a hobby to understand that's the best way to
understand something is to try things on. So probably my

(03:33):
earliest thing was years ago. I can't even remember. This
is probably back when I was in Asia Pacific just
trying to connect, just set up a wallet and connect
to various blockchain zen, try to swap, try to get
into it. And that's probably one of the earliest times.
I think that the critical unlock is really when the

(03:57):
transition from the bitcoin just as a as a as
a currency into more of a programmable platform, when the
change themselves were more gentle purpose more it becomes like
an alternative compute method that can really people can build
applications on top of it. That is, I think is
the is an unlock where I personally saw, Wow, this

(04:19):
has actually a lot more to it. I know, the
res his history, and I'm kind of in terms of
how this has opened up beyond just the core store
of value the bitcoin story. Yeah.

Speaker 2 (04:32):
Now, Roger, you know, relative to other industries and asset classes,
this technology and asset class is still very young. There's
still billions of people who don't really recognize what it
is and its implications. So I'm sure as some of
the viewers and listeners are going to ask, so, what
why would MasterCard want to use blockchain technology and stable coins?

(04:57):
How would you answer to that question?

Speaker 1 (05:00):
Yeah, So the answer to this actually almost has almost
nothing to do with specifically crypto or a blockchain for
that matter. If you look at what master Card does
and people most of the consumers know about because they
have a card and they go use it, that card
represents a abstraction or the functionality of quite a bit

(05:22):
of complexity that is behind it. You could just you know,
we have about three point five billion cards and you
could take that and go to any of the one
hundred and fifty million merchant locations. You can just simply
with a tap and pay, and you don't decide what currency.
You may have a currency. You know, you may use
a debit card, you may use even a crypto card,

(05:44):
and the other side the merchants decide what currency that
they want to get paid, and you really don't think
about it. You just go tap. It simply works. You
could go to any of the countries and simply work.
That complexity is all abstracted away into a simple consumer experience,
and that's what people think about. And so when new

(06:05):
forms of store of value comes in in this case
we are talking about crypto, whether that is a bitcoin
or a ether or even stable coin, simply how do
you access that value to be able to spend anywhere
that you want to spend. So the way that we
think about it is so, yeah, as these store of
value become a more legitimate it has legal standing, a

(06:29):
regulatory standing in a given jurisdiction, we want to make
sure that the power of the network is available to
this new class of values as well. It is. So
it's all about coming to a very simple thing, is choice, right,
can you know? People want to spend the money that
they have, and we want to make sure that it's
easy to do. People want to receive a specific currency

(06:52):
they want in a given jurisdiction, we make that happen
as well. So it's really about that. It's that simple.
That's why we get involved in the space because we
have a publication to curate and provide the best forms
of currencies and optionality to all the people. Starting with
you know, consumer payments, but it also kind of goes

(07:13):
into other forms of payments like remittances and so on.

Speaker 2 (07:16):
Yeah, oh for sure. And do you envision that eventually
beyond just okay, I want to spend some Bitcoin or
either or whichever crypto asset, that the stable coin technology
will be powering majority of payments because of the instant settlement,
the transparency, and the end consumer may not even know

(07:37):
that's happening behind the scenes. They just need to know
it works.

Speaker 1 (07:40):
Look from a consumer person to merchant payments, that is
really you know, it works incredibly well. As I was
talking about, like you know, millions of consumers going to
millions of merchants, and whether you're tapped to pay, whether
you're in a whether in New York subway, our London
tube or online one click checkout, it's all kind of

(08:03):
very seamless. Now, some of the people behind the scenes
may say, look, I have a bank account and I
have a checkingcount saving account, or some people may say, look,
I have this great credit card from they have a
great credit card from say American Airlines credit card. It
could be that, or it could be a Gemini credit

(08:25):
card that owns bitcoin back in towards whatever that card
form that you have, you could go spend at that merchant.
Right now, what we've seen is that, look, we are
enabling that optionality on the consumer side, like if you
have a stable coin wallet, you can access it through
this card and the merchants, most merchants in Western markets

(08:48):
actually continue to prefer to get paid in local currencies,
and in many markets you're required to get paid in
the local currency. So that's what that's what the merchants
need to get paid in. But in some markets people prefer, oh, no,
can you pay me in stable coins? Like I don't,
and they don't say that this is very important, right
Tony merchants, let's say in Argentina, in another market, okay,

(09:14):
they say that, look, I prefer to get paid in
a stable coin, right. They don't say that, if Tony
comes with the stable coin wallet, please pay me in
stable coin. They actually say, look, I want to get
paid in stable coint because that's my preferred way to
receive no matter who shows up. So no matter which
one of those cards that I talked about shows up

(09:35):
at that merchant location, they still get to exercise their
choice of getting paid in stable That's quite powerful right now,
whether you know, yeah, I can stable coin move faster?
We actually you know, you know, in our remitants business,
we today settle even without stable coins, in real time,
near real time with each ten billion plus locations around

(09:58):
the world. Yeah, in some cases stable coins can help accelerate.
You know. We can talk a little bit about the
programmable nature of the money and how it can help.
But it is part of the answer, it's not the
whole answer, you see, somebody need to still stand up
the whole surface.

Speaker 2 (10:15):
Oh sure, so yeah, that definitely makes sense. So you
have that optionality for the consumer, but it doesn't necessarily
have to power everything, just maybe certain corridors maybe where
that can help speed up things and having the consumer
have the option it. Like you said, if you're in
another country, you can choose to have the stable coins.

Speaker 1 (10:36):
Yeah, yeah, that's right. So look, even in the case
of cross border remittants, whereas stable coins people are talking about.
The way that you think about this is that if
you have a new store of value, new wallet where
you choose to store things in a certain format, let's
say in stable coins, that choice again is independent and

(10:58):
somebody on that side you want to send money to,
you can't tell them. Look, prease open a stable coin
wallet and so that I can send money. It's kind
of how absurd that looks. You want to be able
to send the money based on simple email or mobile number,
and the other person should be able to exercise that choice.
Maybe they're a bank account person, maybe they're a telco

(11:19):
wallet person. Maybe there is a crypto wallet, there is
a cryptovallet person. On the other side, you need to
be able to send the money whatever format that you have,
and that's important. So again people talk about oh stable coin, Yes,
it can be a critical part of that starting of
the rail, the remittance flow or the end. But you

(11:43):
need to be able to go from fiat to stable,
stable to fiat if you truly want to deliver the
choice thing. As you can see, this is a repeating
thing between the between both use cases.

Speaker 2 (11:57):
Oh absolutely. You know you mentioned just a minute ago
about programmable money and this technology allowing each to program
these stable coins or different assets. Tell us about your
view on that and how MasterCard may look to leverage that.

Speaker 1 (12:12):
Yeah, look, this is a this is the critical this
is the this is the new feature. Right. The rest
are all we talked about. How we need to be
tied together. The power of the programmability comes in when
you are able to first of all, move this money format.
In this case, we are talking about stable coin and
being able to purchase assets on the other side. You know,

(12:36):
people the industry would call it as d VP, but
we can simply call it as a swap for the
for the crypto world. If you want, uh, how do
you do that in a in an automated way, but
in also a very highly assured way, meaning that the
money moves only if the asset moves and if it
both happens together or or or not. That is just

(12:59):
one program ammable primitive. I think that's quite powerful. There
are other primitives like, for example, can I can I
actually hold the money for a certain purpose until you
meet that condition?

Speaker 2 (13:12):
Right?

Speaker 1 (13:12):
How do you? How do you meet that? That condition
could be that a delivery of good somewhere, could be
another real world event that is happening. All of that
it allows you to express in a format that that
is much more transparent way, if you will, and that
I think is not just reserved to just stable coins.

(13:34):
We feel the way that we think about this is
that uh, a financial institution or a consumer or a
business should be able to hold the money in the
format that they prefer. Sometimes it's stable coins, sometimes it
could be bank deposits. So we think that even if
you are in the form of a bank deposit, the
classic bank deposit, you need to be able to bring

(13:56):
that programmability on those primitives of like the DVP are
conditional release of payments. All of that work seamlessly, and
that's part of the reason. We've been investing the tokenized
deposit technology as well, and we have products and solutions
there as well, and I think that is important. The
reason for that is, like you know, we stable coins

(14:19):
are you know, have grown tremendously and they're going to
continue to grow. There's no doubt, especially with the clear
regulatory clarity of the Genius and MICA and so forth.
But it's also true that the fundamental economy today is
continue to be driven by this fractional reserve system, which

(14:39):
enables banks to take deposits, lend and create money supply,
if you will. That drives the economy, so that format
will continue to exist. I haven't checked the market cap.
I think we have a few hundred billion in terms
of the stable coin market cap. I think US dollar
deposits of alone is fourteen fifteen trillions something like that.

(15:01):
In terms of posits, that's just one currency. So I
think it is our obligation, you know, those of us
in the crypto industry that bring the benefits to the
biggest money format and regulated money format that exists, which
is deposits so we've been saying this for some time
as well, and because we believe in that, and so

(15:22):
it is not like one currency versus one format versus
the other. As long as it has the right attributes,
which is clear parameters around how the currency works, regulatory
framework right, and we are able to offer that format
in use cases in a way that's accessible to that

(15:42):
consumer or a business base, then we are for it.
And that's been driving our product strategy on this for
quite some time.

Speaker 2 (15:52):
You mentioned this a Genius Act being passed into law,
pretty historic, and you know it has a lot of
implications means as well as US dollar. Do you envision
that innovation around stable coins? Will you know, have an explosion,
We're going to see new issuers and could that market
hit one trillion by next year.

Speaker 1 (16:14):
Look, I'm not very good at in protecting crystal ball thing,
and that's not what I think the trends are. The
preconditions are set for people to build new use cases
around it, for sure, right, and I believe those companies

(16:34):
that offer an end to end value proposition because stable
kind at the end of it is a rail to
move money, right. Stable coin present in a public blockchain
is a rail to move money. You build use cases
when you for that segment consumer or a business segment,
go put all the protections and on the simplicity and

(17:00):
user experience with it for you to turn into an
end to end use case, whether that is consumer payments,
which we think that continue to cards continue to be
the best way to access them, even if the format
of the currency is the tables and as I was
saying in the remittance is it is it is really
about standing that end to end use case where people

(17:20):
may have choice about where you want to send and received. Yeah,
I think the future is bright on that. You've also
seen other jurisdictions Tony, And you know we briefly mentioned
MICA in Europe, so you can expect more stable coins

(17:41):
that are Euro denominated to come up. Hong Kong HKMA
Hong Kong Monetary Authority has a clear framework for stable
coins as well. M AS in Singapore has a clear
framework for stable coins as well. UAE is coming up
with a similar one. So you can see that multiple currencies,

(18:01):
not just you as dollars will will will be there
and as you can see that in itself will will start.
How do you get from one to another, and all
those things need to be solved. It's still not those
are those are in early stages. All of this would
determine the kind of the trajectory that you're on. Right,
So today it is it is actually in most markets

(18:25):
to getting too from stable to feat Those markets are
not as deep as fear to feel it, which is
a critical infrastructure you need to unlock in order for
that to get to the next level of the growth
for it to be considerct kind of a normal other
form of the currency. Right.

Speaker 2 (18:42):
Oh, absolutely, So the envision the future payments, you have
these different digital currencies in stable cooin format there they
can be interoppable, they're on multiple blockchains, and well many
of us are going to have digital wallets. We're headed
to a more digital world. We're not going to use
cash and going to have the optionality like you were
saying before, maybe some of some quarters at a traditional

(19:04):
rail summer powered by sable coins. You got digital assets
in crypto. You know, all that in that respective wallet,
and you know, I could send international payments from my phone,
I can make a payment at Starbucks and all these
things are done in that wallet.

Speaker 1 (19:19):
Yeah, so most lot of these experiences that you're talking
about happens today, right, So so you could you know,
you could have your Apple wallet or a bank wallet
are are or if you're an Android, there are many
options there as well. People can go pay today. I

(19:39):
think that experience is well done already and the optionality
that need to be added is is those purses, those
new stable coin wallets that are coming out, can be
equally accessed easily. And so we have many such cads right.
For example, card Gemini is the credit card that owns

(20:03):
crypto rewards. We have a card with Crypto dot Com
in the in the Middle East, crack in Europe for example.
Even the metal mask and the self cut to the
wallet have a master cut card attached to it. So
you go through a KYC process, you can bring your funds,
whatever the assets are, and the card starts working as

(20:27):
simple as any other card. The kind of power that
it puts in the phone consumer is quite quite quite significant,
and that's what we are excited about to bring bridge
the world of the crypto to the kind of the
one hundred and fifty million merchant accept on locations and growing.

(20:48):
I should say.

Speaker 2 (20:50):
To those consumers, now, tell us a bit about which
table coins you're using because I noticed that master Card
had joined the us d G stable Coin Consortium, a
global dollar network in stortium. Excuse me, are you primarily
using us d G or are you kind of agnostic?
We're using us DC and other stable coins as well.

Speaker 1 (21:12):
Yeah, Look, we support multiple stable coins in many of
our use cases today consumers, not consumers, the business, the
financial institutions that issue cards, or the acquirers that connect
merchants can actually UH settled with through our partners in
multiple stable coins. We've been supporting us DC for the

(21:33):
longest time now and U s DP, which was which
was a part of stable coin. What you saw is
announcing last couple of weeks ago is that we are
adding a few more coins support That includes the PayPal
us D U s d G. I'll come to the
USDG discussion in a bit, and five U s D

(21:57):
as well, because Fisov announced that plans to launch one.
What you're seeing there is that as long as the
coin is well formed, confirmed to a certain regulatory jurisdictions
where they operate in, we want to be able to
make that available in our network, which is not very

(22:18):
different from how our traditional network works. One hundred and
fifty plus currencies are supported in our network, several of
them as settlement as well, So it is it's natural
for us to add support to that those currencies with USDG.
You asked an earlier question, look or everybody wanting to
launch coin. Look, I think there is an upper limit

(22:42):
to the number of coins that would can play a
useful role in driving some of these use cases. Because
each look you made this point earlier, each of the
stable coin, if you look at it, you got to
issue them, manage them, make them available, multiple blockchain networks,

(23:03):
list them in multiple exchanges, create deep liquidity between that
pair and the other pairs. It is actually a hard work,
and we think that the market would converge to a
few stable coins in the world. We're not here to
pick winners. What we wanted to do here really is

(23:24):
with the USDG joining with paksos to provide the option
for a financial institution or a fintech want to offer
this to their consumers, they should have an easy way
to do. So what we're hoping is we can provide
that access, and we already it in an off ramp
between the FIAT and the stable coin world, and we

(23:46):
think we can continue to play a very effective role
there in partnership with the pacsos. So we're making it
easy for them to access and that's the part of it,
and I think that helps people kind of uh, you know,
use that coin and build scale around one or two
if you will, and we'll continue to support other coins

(24:08):
as well. As I was saying before, uh, this is
this is more of an access mechanism, easy access mechanism
for financial institutions.

Speaker 2 (24:17):
Yeah, and you're definitely your point of you know, there's
gonna be some consolidation because there's gonna be so many
stable coins and issuers. But look, that's you know, that's
part of markets and innovation. But there's probably just going
to be a handful of winners. But I love that
you guys are not picking winners and losers and you're
being agnostic and supporting the respective stable coins as long

(24:39):
as that everything is copathetic.

Speaker 1 (24:41):
Yeah, yeah, yeah, that's that's correct. That's correct.

Speaker 2 (24:44):
Now. MasterCard has a lot on its plate when it
comes to crypto, and you touched on quite a few
of them. I wanted to go through Crypto Credential because
that one really fascinates me. Where building the technology where
I can just give you, uh a let's say, like
an email address sort of story to speak, or a
user name, and then you can send me any form

(25:05):
of payments.

Speaker 1 (25:06):
Yeah. Look, it's very quite excited about this, and the
market has received this really well. And the whole thing
started with you know, our own kind of looking at
even some of the people and the team and are
trying to kind of send money using blockchain. We are
pretty blockchain native users, we would like to say, some
of us and the team trying to send money to
another person is quite conversion even today for most cases. Right,

(25:31):
let's since we're kind of going behind the covers here
a little bit. You know, what does it take you've got?
If I need to send you ten dollars? I had
to ask you kind of you know, Tony, can you
text me or blockchain address? And you may text me.
And let's say, even I know how to use it
in this case, I may know, but a common consumer

(25:52):
they have to go cut and paste to wear. Okay,
I go to a wallet and I send it. Okay,
I have soul, can you receive soul? I have US
d C and you prefer usd G H are you
on is your wallet provider connected to the right chains? Uh,

(26:13):
there is so much complexity, right, just scratching the surface.
And how do I my let's say I'm with with
with a crypto wallet, and how do they know that
you your wallet provider is a compliant one? Uh? Is
what jurisdiction you are in? Are you a ky seed person?
How do I prove that I'm actually facilitating a travel

(26:35):
rule compliant transaction? So so much of this we said, look,
it's very simple if you if you look at how
the experience is in this case, let's replay the experience
and I would say, you know, Tony, I would like
to send ten dollars and you would basically, you know,
we already know each other's mobile number or email, and

(26:55):
I'll go plug that in my and immediately my wallet
provider will have information about who's your wallet provider, what
kind of assets that you can receive safely, what kind
of assets, what level of ky C that you've passed,
and all of that information is available behind the scenes.

(27:15):
And so that it's a simple. The experience is so
simple that you just entered the email, it immediately kind
of verifies you've done right. So that is that I
think is quite resonating quite well. What we've also announced
the last couple of couple of weeks ago is that

(27:36):
that kind of a simple ALIAS based experience, which is
pure crypto to crypto, is already live. And then the
marketplace for us with the crypto credential that you refer to.
But we also have a classic remittance business that was
originally fear to fear it, where now we can enable

(27:56):
stable card wallets to send money to each other as well.
So that functionality and this alias is coming together. So
the beauty of that is that, look, you could start
with uh. You could in this case you could have
a bank account and the experience would still be the same.
I will send money to this mobile number, so to speak,

(28:17):
Tony's mobile number, and you could have made the choice
to say, look, I would actually receive the money in
the bank account, and you may be in let's say
Philippines and I'm an US or vice versa. That kind
of simple user experience is all possible now. And because
we are able to move the money behind the scenes,

(28:37):
even one leg is krypto on the other leg is
fie it right uh and UH. And that comes together
with the with the simple consumer experience. We're quite excited
about the combining our money movement thing with this, and
because that's what I think consumers wanted, that's what the
businesses were actually operating opening up this remedtancy case want. Look,

(29:03):
everyone wants to be compliant to do the right thing,
but it's it's got to be easy to do so.
It got to be easy to do so for the
with the right tools and services, which which which is
which is why we are quite excited about this combination.

Speaker 2 (29:18):
Absolutely, I'm excited for that too because over the years,
I've just seen so much friction in people trying to
move funds to your point of selling, sending wallet addresses
and things like that, and I feel like what you
guys are building is such a critical part of the
infrastructure for mass adoption.

Speaker 1 (29:34):
Uh.

Speaker 2 (29:34):
You know, I think the people who are not as
technical and who are scared of the long wallet addresses
right and and and all those things, and just being
able to make it feel like Web two so to speak,
but it's Web three tech. It's all done behind the scenes, interwoppable.

Speaker 1 (29:52):
Uh.

Speaker 2 (29:53):
You know, you can swap out between crypto assets, traditional currencies,
and much more. And it's just easy. It just works.

Speaker 1 (30:00):
Yeah, Yeah, I don't think it is the market expectation
or the consumer expectation is unreasonable here. They're simply asking that,
you know, can I bring the form of the vallet
of the bank account and the currency preference and you
bring yours and can we just simply transact and be
compliant at the same time. It's not a it's not

(30:21):
a big expectation if you ask me, and and it's
the industry's obligation to to deliver it. And we're happy
to happy to help in that process.

Speaker 2 (30:31):
Yeh, tell us about the multi Tooken network or I
don't know if you already touched on that earlier with
some of the details we were discussing.

Speaker 1 (30:40):
Yeah, Look, the multi Tooken network is the proposition that
we came up with a few years ago where we said, look,
we've got to make this programmable money work for deposits
to right. And part of that is because of how
how regulated that money is that is already available in

(31:01):
abundance and it's it's is uh and in every market. Right.
What was missing was, you know, how do you bring
this level of immediacy of payments and you know, how
fast the money moves, how fast the money settles, and
the programmability to it. So so that is that's what
we we've done there. We've started working with some of

(31:22):
the largest banks, including JPM and this topic. They've they've
been a tremendous innovators in the marketplace as well. They've
led pretty much the whole industry from a financial institution
perspective in taking steps and we're very glad to partner
with them. And end of the day, what that means

(31:44):
is that a business or a consumer with a bank
account able to participate in some of the tokenized real
world assets, which is a growing space. This is the
next cycle of growth for for the crypto industry. I
feel that's coming up in terms of the new assets

(32:04):
coming onto the chain. So if new assets come out
to the chain, the commerce will follow. And how does
you need a money format that is that has that
addresses everybody's needs? Uh, And that's been our our bet
and and market is clearly you may have seen Bank

(32:24):
of England recently made pretty public remarks about how they
are very pro togonized deposits are You've seen some of
the largest financial institutions and come out and say, there's
the same thing. We think that uh oh, this this
kind of format is here to stay. But the key

(32:45):
is a buyer may want to start with the bank account, Tony.
You may start to see the theme repeating itself. The
seller of something may want to receive in stable coins.
All that need to work. This is we that's for
the industry like us to figure out how to make
that simple to work. And the solution is just that

(33:09):
if you look at a consumer or the business experience
of how multi tooken network, its simply you connect to
your bank account to it, and you can go to
any of the tokenized asset marketplaces and you buy it
just like anything else that you buy. But in this case,
behind the scenes, you know, programmable money is created, a

(33:30):
settlement is happening. This is all bit of inside the
system and in terms of how it works. But the
idea is to make it very very simple from end
user perspective, no matter the kind of format of the
money you have.

Speaker 2 (33:45):
Yeah. Absolutely, you mentioned in partnering with JP Morgan, there's
this technology allow these different institutions MasterCard and banks and
much more to have a more trusted partnership. Obviously, there's
been partnerships set up. Historically, you look at the Swift
system and the movement of money and the messaging system.

(34:07):
But with blockchain, I can trust these different intermediaries and
different folks much better. It's all real time, it's all transparent.

Speaker 1 (34:17):
Yeah. Yeah, Look, it's the way that the short answer
to your question is the block Does blockchain help make
this possible more easily? Absolutely yes, but it reminds what
is also true is that you got to have a
common interoperable standards in terms of how these things are

(34:40):
set up, and you really need to know that, Okay,
the other person, the person with the other side of
the wallet, or the buyer or the seller in this case,
who's the person, what KYC levels have gone through, how
do you send money to them, and how does it
get settled. All of that interoperability need to be set

(35:03):
up by some third party. Having provided interoperable solutions between
financial institutions for consumers and merchants for decades, and we
think we have a role to play. So if there's,
for example, in the case the JPM example that you
gave the other bank, if you send a tokenized deposit

(35:23):
from one bank to another bank, somebody need to make
sure that that can be settled. Somebody need to make
sure that it is going to the right person, and
it is the standards of how one token interprets with other.
We think we have a role to play as well.
So it's really, yes, it's decentralized blockchain technology, but at

(35:43):
the same time it requires people, people kind of setting
the standards. It's not very different from how Internet has evolved, Tony.
If you think about it right, Internet is a decentralized network.
Almost all the companies that are built businesses on top
of them is using that as an infrastructure to build
solutions on top that kind of that they couldn't do before.

(36:06):
But they're all centralized companies. I think what you're seeing
here is the same thing play out right. You know,
some of the largest exchanges are our corporations, right, so
providing solutions and there is and they've been able to
build scale examples like coin based in crypto, dot common Song.

(36:27):
So they're able to build scale because they are able
to organize around use the technology, but simplify it to
make it accessible for everyone.

Speaker 2 (36:38):
Do you believe in order to set up that standard
for interoperability, these the banks, some of the other trade
FI institutions and some of the native crypto companies need
to form some sort of association developer standard. The government
also has a buy in because payments will probably have
to go in and out the government in these formats,

(36:59):
and that's kind of how it gets going.

Speaker 1 (37:02):
You see that already happening, right, So the so there
are a lot of standards emerging and we're helping. For example,
crypto credential is we are offering that as a framework
for how use case that we used in the crypto
credential example is the remittance use case. But that framework

(37:22):
actually applies throughout. It could be a B to B payment.
The obligations on the buyers and seller side different in
that case compared to a classic or remittance transaction. The
rules may be different, the participation requirements may be different,
the regulations may be different, but that framework applies, and

(37:43):
we think that's a scalable approach to opening up other
use cases on chain as well. In fact, our multi
Tooken network we use a motion of that technology for
enabling buyers and sellers. Right. Yeah, standardization is is uh is.
I think interoperability is quite important for this to scale. Look,

(38:05):
you're going to see multiple coins come up, right, You're
going to see multiple form of currencies come up, and yeah,
it need to. You can't expect this to kind of
self regulate, if you will, in terms of how this
interoperability works. You need somebody to kind of stand up
a service that make sure that it indeed happens under

(38:25):
a common approach and if it, if it touches consumers
user experience, how do you standardize that? That's quite important too.

Speaker 2 (38:35):
Absolutely, I'm curious as to which blockchains you're building on.
I think you touched on some of it. Obviously you're
agnostic when it comes to stable coins, but you know
as far as your systems, which blockchains are primarily powering it.
I think I read Onto and maybe Ethereum and things
like that. Maybe you can give some clarity there.

Speaker 1 (38:56):
Yeah, so we've started out in earliest days. EBM compatible
chain is how we started because that kind of provides
the maximum scale. Some are you know, obviously the main net,
but also the altos and on side chains and so
on that gives compatibility. We are, again here very agnostic
where we we will go wherever the commerce activity happens, right,

(39:22):
and in some ways this multiple chains are are, makes
makes transactions a bit more harder to make it work
because if you could have money in one chain the
asset and another chain, and again you know, somebody need
to provide the assurance that the transaction will go through.
That's part of what we do. Uh. And yeah, we

(39:46):
are again chain agnostic. Will go where the assets and
assets are. And the reason we go where the assets
are is because that's where the commerce happens and that's
where the need for a payment experience need to be there. Uh.
And be it open to supporting all chains in the
fact that we work with the number of them at
the moment, some of them, I should say, it's there

(40:07):
are some, especially in the institutional US cases. You will
also find some chains that are private and are semi
public or permissioned, whatever the grade of openness that you
want to you want to put a term to.

Speaker 2 (40:21):
Yeah, So, speaking of permission and public blockchains, do you
think we're going to see a mix of that. Let's say,
like you and the folks in Massacard may have certain transactions,
certain things you want on a permission blockchain, but some
on the public. Same thing for JP Morgan, these banks,
right because there or you use the public and you
have ZK or is your knowledge proofs as part of

(40:45):
a way to hide the information.

Speaker 1 (40:48):
Okay, Yeah, I think this privacy is going to be
quite important. There are certain classive transactions that are kind
of net transactions. Maybe it's okay to go public in
the public chain. And I think now the safety soundness,
as the people in the industry would say, is coming

(41:08):
up and getting better in the public chains, and they're
becoming more resilient, and there's a healthy competition happening, which
is great. But I think there would be a class
of transactions that would maybe look end of the day.
Why this public private chain debate comes in is very simple, right.
It's all about do you have all the people who

(41:29):
need it in their ecosystem participating in that chain. If not,
there is an efficiency created. So there are certain ecosystems
where institutions can come together and say, for this class
of transactions, we would rather keep it. We'd still want
it programmable, we still want it interoperable, we still want
it kind of sufficiently decentralized so that we can all

(41:51):
use it as a common infrastructure. But I don't necessarily
feel that unless you have a b to b agreement
between two institutions. There is no reason to put this
in the public chain. That would be a certain class.
But I I think I'm a big believer, uh in
in the public chains. The reason for this is that
that's where the open innovation happens. Anybody could go build

(42:14):
an app and any any currency provider in a e
r C twenty using the e v M example, the
standard or the derivatives that are quite a few derivatives
on the on, the on the on that as well,
UH provide the programability. What is programmability is being able
to deal with this multiple currencies in a simple way.

(42:35):
And an application or a smart contract in that case
is what I call us. An app can take advantage
of this currency formats. And I think that that kind
of lego block like building is essential to essential to
building scale and so therefore public change are here to
stay and I think I think that would continue to

(42:56):
be the primary hotbit for innovation and the space, and
we're coming to do providing solutions there.

Speaker 2 (43:04):
I don't know if this makes sense and if it's
a question you can answer, because it just came to mind,
and it's maybe a bit less feel from what you
guys are doing. Obviously you're dealing with consumers and enabling
better payments and different options. But also with this technology
of blockchain, I feel like eventually our data, like my
information can be on the blockchain, encrypted and I can

(43:26):
feel free to release it to different brands and companies
like MasterCard, right, and maybe this will help prevent data
breaches and you know things we've experienced over the past
few decades. Do you think it makes sense eventually that
our information will be on the blockchain and tight in
with our payments and digital identity.

Speaker 1 (43:45):
So digital identity, just taking on that first, I think
it is the blockchain can potentially play a big role
in this. For us. We've taken the practical approach of
trying to because identity is a very very loaded topic, right.
It often it comes because a government gives you an

(44:06):
identity and they are the primary issue of the identity
in most jurisdiction. So we think all the regulated activity
need to somehow tie So therefore the KYC process need
to be tied to that government. ID what we preferred,
at least the way that we've approached in crypto credential
is that I would rather focus on use cases that

(44:31):
this identity or this wallet is enabled for and if
you've gone through the sufficient checks or the KOYC process
by somebody who has the obligation to do the KOYC
for you can complete that's quite important, and they have
an economic reason to do so, because the issue with

(44:53):
the kind of the notions of self sovereign identity and
so on is that it lacks kind of the overall
commercial incentive and tie back to that government ID, which
is essential for corporations who regulated in the jurisdiction to
provide services to you. So we rather kind of take
the approach. It's a bit nuanceers, but what I'm trying
to say is that we'd rather take the approach of saying, look,

(45:16):
in order for you to send a remittance transaction in
this jurisdiction, here are the KYC requirements. Here are the
travel rule requirements. And by the way, this company could
be an exchange, could be a bank has taken on
the obligation to KYCU to meet that obligation, and we
will Crypto Credential will provide a proof of that on

(45:38):
chain that Tony has gone through this in US according
to these requirements. By this vallet provider and they stand
behind Tony. Now Tony can go send money and this person,
this banker who did the KYC, stands behind that transaction.

(45:58):
So this is a more a use case focused view
of the identity, which is a very practical way that
we're moving forward. Not opposed to this evolving to some
UH an identity kind of a pure form of an identity,
but that that remains to be seen. We've taken the
practical approach of, you know, what activity you want to

(46:19):
enable with that identity, who stands behind that that that
that that that identity for that use case in order
to enable. So I think that's that's the practical approach
that we've taken, and it seemed to resonate in the
market because people are trying to do the same.

Speaker 2 (46:35):
Yeah, yeah, that definitely makes sense. You know, we touched
on the Genius Act and what the implications that for
that is will have for the stable cooin market and
ability ability to use stable coins. But we have the
Clarity Act, which is the market structure bill UH White
House scriptos are David sax That's can be voted on
late September or early October in the Senate and then

(46:57):
possibly be signed into law. What implications is a have
free master Card as a business in dealing with different
crypto assets? Because that bill, will you give some clarity
on security? Not security kind of the swim lanes essentially.

Speaker 1 (47:11):
Yeah, So look, the details are still being worked through.
It remains to be seen. But from our perspective, today
consumers can buy and sell crypto assets using our cards
and many many exchanges where they accept master Card, which
we hope to continue to support make it easy for
consumers to exercise their choice. There. That is the primary

(47:36):
wave that we will engage with other assets, non payment
like currencies, but assets. People can buy their bitcoin if
you will today and we hope that that will continue.
But the rest of the nuances of the various things,
we have to see what the implications are, and we
are focused on making sure that the simple payment experience

(47:58):
is enabled for all those conscers, rumors and continue to be.
There is our primary focus there.

Speaker 2 (48:06):
Roger, I wish we had another hour, but I don't know.
We come up in time, and I got some wrap
up questions here for you. Uh, First, if you could
create your own metaverse, what would the theme be?

Speaker 1 (48:16):
Wow? Look, I I yeah, this is a This is
a tough one. And look, we've been we've experimented some
early on about how our brand can engage with with
with the metaverse and as people come and visit our

(48:37):
brand experience, and we've seen some early engagement there. But
I think this as a format is I think we
need to put all the brands need to put more
thought into it is and what is something that unique
experience that you can provide there that is distinct from
the real world experience. So we have some lessons learned

(48:59):
from that and we look to re engage the market
as as this thing evolves, but it needs to end
of the day, I think it needs to provide something really.

Speaker 2 (49:07):
Unique, absolutely rapid fire questions.

Speaker 1 (49:11):
Favorite food, Favorite food, Yeah, seafood is the favorite food
any time of the day.

Speaker 2 (49:19):
Favorite musician or band.

Speaker 1 (49:21):
Look, I come from uh South India, So there's a
famous musician called Raja. There's has a lot of tumbel
sounds and that I keep going back to those whatever
you grew up with it right, sorry, whatever you grew
up with in your yeah yeah.

Speaker 2 (49:40):
Yeah, you haven't a special affinity, special place in your heart, right,
that's right?

Speaker 1 (49:44):
Yeah? Favorite movie? Wow, I'll say the favorite genre. I
would say, uh, a lot of this. Uh, the movies
that tie the historical history to to life and many
movies that are taken with the historical fiction in mind.

(50:06):
Is the genre that I keep going to. Mm hmm.

Speaker 2 (50:09):
Favorite book.

Speaker 1 (50:13):
Again, I would I would go into a lot of fiction,
historical fiction. That's the That's the genre I'll keep going to.

Speaker 2 (50:20):
And when you're not working a MasterCard, what are you
doing for fun?

Speaker 1 (50:24):
Oh? Look, I love I live in the Bay Area,
so running and biking is his favorite. And uh, we
hike as a family as well, and we are we are.
We recently hiked have this base camp, which we are
quite quite excited about, and I hope to continue to

(50:45):
go onto other other other hiking journeys with the area.
It's very easy to get into the trails. You should
when you visit here next time. We should should take
a high.

Speaker 2 (50:56):
Absolutely, Roger, absolute pleasure. I love what MasterCard is doing
with blockchain and crypto and stable coins, and I love
the crypto credential because I feel like that's just a
major pillar that's needed for adoption. And I would love
to have you back on in future. But thank you
so much for joining me.

Speaker 1 (51:14):
Thank you for having me, it's been a great discussion
and look forward to seeing you in real life at
some point.

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