Original Title: Why Circle thinks the next phase of crypto will be about payments, not speculation
Original Author: @benfoxrubin, Mastercard
Translation by: Peggy, BlockBeats
Editor’s Note: As the scale of stablecoins continues to expand, blockchain is gradually moving from speculation narratives towards financial infrastructure. Recently, Mastercard launched the Crypto Partner Program, collaborating with several institutions including Circle to promote the application of digital assets, reflecting that traditional payment systems are re-evaluating the role of blockchain.
In the view of Circle's Chief Business Officer, Kash Razzaghi, the true mainstream adoption of stablecoins will not appear in the form of "crypto products," but will be embedded as an invisible financial "pipeline" into the payment system. This article discusses this trend, the path of stablecoins transitioning from transaction tools to payment infrastructure, and why traditional financial institutions are beginning to take an active role in this shift.
Here is the original text:
Circle's most well-known product is its stablecoin USDC. Currently, the circulation scale of USDC has exceeded $77 billion, making it one of the largest stablecoins in the world. But Circle's ambitions go beyond that.
The company is committed to building a comprehensive infrastructure to drive blockchain payments and financial services towards true widespread application. Specifically, Circle provides blockchain-based payment capabilities and financial functions to businesses by offering developer tools, launching the Circle Payments Network, and building its own blockchain Arc, enabling nearly any company to access the on-chain financial system.
Circle's Chief Business Officer, Kash Razzaghi (responsible for company partnerships and strategy), stated, "We are building a system known as an internet finance platform, aimed at truly promoting and accelerating the flow of funds on-chain."
In his view, migrating financial infrastructure onto blockchain has the potential to make the flow of funds faster, cheaper, and more transparent. However, he also pointed out that reshaping the entire payment ecology is not something any single institution can accomplish alone; therefore, Circle is collaborating with several companies, including Mastercard, to expand the use and acceptance of stablecoins globally. This week, Mastercard announced the new Crypto Partner Program, and Circle has also become a member.
Razzaghi added, "This requires participation from the entire ecosystem. Mastercard's involvement brings tremendous credibility to what this technology can develop into and what forms this industry may evolve into in the future."
Kash Razzaghi (Circle's COO): When stablecoins and this entire set of technologies are truly mainstream, they will become the underlying infrastructure like "water and electrical pipelines" where people use them but are hardly aware that they hold stablecoins.
Kash Razzaghi was interviewed by Mastercard News Center shortly after returning from the World Economic Forum in January. During Davos, he engaged with numerous individuals from the finance and financial services sector, hoping to attract more institutions into the expanding blockchain ecosystem.
The following question-and-answer content has been edited for clarity and brevity.
What is your view on the current free-floating cryptocurrency market?
The market volatility is to be expected. In fact, speculation has been the main driving force for most of crypto's history.
What truly excites us is that the industry is moving from speculation to infrastructure. Of course, trading and speculation will not disappear entirely, but that is not the point. The key is that the industry is undergoing an evolution: gradually transitioning from a speculative market to financial infrastructure.
The crypto market has indeed experienced periods of prosperity and more turbulent phases. These cycles have always existed. If some people choose to exit, there will definitely be new participants entering — that’s how the market operates.
What were the main discussion points about blockchain at this year's Davos?
This year’s discussions in Davos were almost entirely focused on infrastructure.
People discussed how blockchain technology and digital assets can solve real-world problems, or enhance the capability of fund flow, value storage, and access to financial systems.
This year’s Davos felt very positive. As regulations gradually pave the way for institutional participation, the advantages of blockchain infrastructure are becoming more evident. The focus of the discussions is no longer speculation, but:
How to use this technology to transfer tens of billions or even hundreds of trillions of dollars of value instantly, securely, and at low cost
How to upgrade a financial system infrastructure that has seen almost no fundamental changes for the past 75 years
The industry generally believes that this transformation will benefit the entire ecosystem. Whether it’s financial infrastructure companies, financial market participants, or financial service institutions, they can leverage this technology to upgrade their businesses and provide better services.
For a long time, the market narrative was: Will blockchain replace banks? Will it replace card organizations? Will it replace the traditional financial system?
But the reality is not that.
What’s truly exciting is that today’s discussions have shifted to how to upgrade and collaborate over the existing financial system. Banks, financial institutions, traditional exchanges, and card organizations are all embracing this technology because they all anticipate that the cost of fund flow will approach zero and the speed of fund flow will significantly increase.
If the financial system is really to be upgraded, what does this mean for Mastercard? How can both sides collaborate and achieve a win-win situation?
Essentially, what does Mastercard provide?
Trust.
You have established a global trust network. I have a Mastercard myself. When I swipe my card, the merchant feels reassured because they know the funds will surely arrive — because Mastercard guarantees it.
In my view, the importance of trust will never fade.
Mastercard’s role in this ecosystem is not only to continue maintaining this trust network but also to provide more advanced technology for transactions, simplify payments, make financial services more inclusive, reduce intermediaries, lower friction costs, and even, over time, further decrease transaction costs.
For Circle, the benefit is the widespread adoption of stablecoins and digital assets.
We believe that the future movement of funds will increasingly take place on-chain. We think that, in the long run, on-chain fund flow will become more efficient.
Of course, achieving this also requires many things to be completed, such as infrastructure construction, regulatory frameworks, and compliance systems.
We are not fully at that stage yet. But when Mastercard starts to truly build on-chain products and provide on-chain services for its clients, it will greatly accelerate the adoption of stablecoins.
What are the main current use cases for stablecoins?
Currently, there are three primary use cases.
Trading and Investment
The largest application scenario for stablecoins remains cryptocurrency trading and investment.
If you are investing in digital assets like Bitcoin or Ethereum, using USDC as a trading medium is very convenient. You can switch between different assets at any time and keep funds in assets of stable value when needed.
Payments (especially Cross-Border Payments)
The second scenario is payments, particularly cross-border payments. If you need to transfer funds from one country to another, whether for institutional fund transfers or personal remittances, stablecoins offer a very efficient solution.
Transferring funds on the blockchain can: reduce intermediaries, lower costs, and shorten settlement times from days or even weeks to seconds or minutes.
We have seen almost all industries conducting large-scale fund transfers. Even a large institution can transfer funds from Singapore to New York using stablecoins, without being limited by bank operating hours.
In the future, stablecoin payments will not only be used in cross-border scenarios but will expand into almost all payment areas.
Value Storage
The third scenario is value storage.
This demand mainly arises in countries where the local currency suffers severe depreciation, such as: Iran (my birthplace), Venezuela, and Argentina.
In these high-inflation countries, residents often no longer trust their local currency and prefer to hold dollar-denominated assets for hedging. Stablecoins provide a digital dollar storage tool.
We believe that the demand for payments and value storage will drive the market size of stablecoins far beyond today’s level.
When do you think stablecoins will achieve mainstream adoption?
There is a viewpoint that when stablecoins and the entire blockchain technology truly achieve mainstream status, they will become the underlying infrastructure. That is to say, people are just holding dollars and sending dollars but are not necessarily aware that they are actually holding stablecoins.
We often use an analogy: When you visit a website, there is HTTP in front of the URL. But most people do not understand the HTTP technology; they simply use the internet.
In the future, stablecoins might have a similar situation where on-chain finance becomes the infrastructure, and users hardly perceive its existence.
Your professional experience spans multiple industries; how does this help you in your current work?
There is actually no such thing as a "standard career path." Career development requires both luck and timing, as well as accumulated experience.
Looking back at my career, you will find it quite varied: the clothing industry, sports social platforms, video distribution platforms, and the crypto industry.
But the commonality behind these experiences is: entrepreneurial spirit, go-to-market capabilities, business development, and sales abilities.
I have always enjoyed building things from the ground up and hope to participate in projects that can impact a large number of people.
When I joined Circle six years ago, I was not particularly "crypto-native" and could hardly be considered a crypto expert. But once you truly understand the potential of this technology, you become inspired by it and gradually develop a sense of mission.
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