Mastercard launches stablecoin risk screening for banks and payment providers

Mastercard is extending its payment risk controls to stablecoin transactions by introducing a tool that lets financial institutions flag suspicious activity before funds move onchain, where recovering stolen funds can be difficult.

Unveiled Monday at the Money20/20 USA conference, Mastercard’s Stablecoin Security combines traditional payment data with blockchain analytics to identify fraud, scams, sanctions exposure and other financial crime risks. Borderless.xyz and Keyrails are the initial partners, with global commercial availability expected next year.

Banks already use fraud detection to monitor conventional payments. Stablecoins add complexity because funds can move across multiple wallets and blockchains, making it harder to assess risk throughout a transaction. Mastercard said Stablecoin Security can generate a risk score before a payment is completed, allowing banks to identify transactions that may require further review.

The launch marks another expansion of Mastercard’s stablecoin business following its $1.8 billion acquisition of BVNK in August. It also follows the company’s recent announcement of a Global Money Platform designed to bring stablecoin payments to businesses.

Mastercard’s stablecoin expansion comes as growth in the supply of digital dollars has slowed significantly this year, even as transaction volumes have accelerated, driven in part by remittances and cross-border payments. A recent Standard Chartered report suggests the stablecoin market could reach $2 trillion by 2030, two years later than its initial forecast.

Related: Mastercard, Borderless test shared identity checks for stablecoin transfers