Bakkt Picks Thredd to Launch Stablecoin Card Program

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The partnership will see Thredd’s card processing and credit infrastructure extend Bakkt’s settlement rails into consumer credit products issued by partner banks through its planned credit card-as-a-service program, the release said. Thredd will also offer tokenization, digital wallet integration, fraud and risk management, and loyalty services designed for the program.

“Launching a credit card that would settle in stablecoins requires tight integration across processing, lending and digital asset infrastructure,” Thredd CEO Jim McCarthy said in the release. “By combining modern card processing with flexible credit capabilities, our platform removes operational complexity so Bakkt can offer its clients a direct, reliable payment product.”

Bakkt chose Thredd because of its technology stack, which removes the need to establish and maintain “complex, separate connections between end-consumer credit and payment components,” according to the release. The companies are designing the program around Bakkt’s requirements instead of shunting the card programs into a “rigid, traditional” processing model.

“We run regulated rails that move value for institutions, and we move it across borders on demand,” Bakkt Chief Product Officer Ankit Khemka said in the release. “This program is designed to bring that same settlement infrastructure to everyday spend.”

An initial proof of concept for the program is slated for the first half of next year, subject to factors including product readiness, bank and network requirements, and applicable approvals.

Meanwhile, the PYMNTS Intelligence report “Waiting for Certainty: Why Most CFOs Are Holding Back on Crypto and Stablecoins” found in March that while stablecoins might have eliminated hours of settlement friction, they haven’t done away with the financial infrastructure waiting on the other end.

The report showed that 88% of companies receiving stablecoins converted them into U.S. dollars immediately.

“Chief financial officers still run payroll through banks, mid-market suppliers still expect conventional currency, and even the most forward-thinking corporate treasurers still need deposits they can invest, borrow against and use to meet obligations today,” PYMNTS reported Monday (Oct. 12).

New findings from the Financial Stability Board showed that for finance teams considering stablecoins to improve B2B payments, “it’s becoming crucial to account for what blockchain innovation removes, what it transfers and what it creates,” the report said.