Coinbase to power stablecoin-backed cards for Marqeta clients

Key points

• Marqeta is expanding its partnership with Coinbase to offer stablecoin-backed cards to business customers
• Coinbase holds the stablecoins and handles conversions; Marqeta issues cards and processes payments
• Base provides onchain settlement, and businesses can fund card programs 24/7
• Fees, launch date and supported stablecoins were not disclosed

Payments company Marqeta is expanding its partnership with Coinbase so that businesses can issue payment cards funded by their customers’ stablecoin holdings, The Block reported on Friday, October 16. Coinbase will provide the stablecoin custody and conversion services behind the cards, while Marqeta continues to issue them and process payments.

How the stablecoin card program works

According to The Block, the arrangement divides the work between the two companies. Coinbase holds the stablecoins and handles conversions between digital and traditional currencies. Marqeta issues the cards and processes the transactions. Coinbase’s Base blockchain supplies the onchain settlement infrastructure.

The offering is aimed at Marqeta’s business customers, which include both crypto-native firms and traditional companies. Cardholders would be able to spend stablecoins at what The Block described as millions of merchants that accept cards. Businesses can also fund their card programs around the clock, the report said.

The Block pointed to a Business Wire press release titled “Marqeta and Coinbase Collaborate to Enable Stablecoin-Backed Card Payments” as the basis for the announcement. In it, Alec Lovett, head of infrastructure products at Coinbase, said the company is “enabling businesses to move money with the speed and efficiency they require,” according to The Block.

A partnership that dates to 2020

The expansion builds on an existing relationship. In October 2020, Coinbase named Marqeta as the processor for its U.S. debit card, which allowed customers to spend crypto, including USDC, and earn crypto rewards, The Block noted. The new program extends that card-processing work from Coinbase’s own consumer product to the businesses that build on Marqeta’s platform.

For those businesses, the main change is that stablecoin balances can serve as the funding source for a card, with conversion to traditional currency handled by Coinbase when a purchase is made. Merchants, as described in the report, would continue to accept the cards as they do any other card payment.

What has not been disclosed

• The Block said the announcement did not specify fees for the service.
• No launch date for the program was given.
• The report did not say which stablecoins would be supported at the start.

Marqeta is a card-issuing and payment-processing platform used by companies that want to offer their own branded cards. Stablecoins, which are digital tokens designed to track the value of the U.S. dollar and other currencies, have increasingly been tied to card spending as payment firms look for ways to let users spend onchain balances without merchants changing how they accept payments.

Neither company’s customers have been named in the report, and it is not yet clear how quickly businesses will be able to launch programs. Further details on pricing, supported tokens and availability are expected to depend on how Marqeta and Coinbase roll out the service to existing clients.