SoFi Bank First National Bank to Use Stablecoin Settlement

SoFi Technologies' shares surged 3% on Tuesday after it announced that its bank has become the first national bank to implement stablecoin settlement across Mastercard's global payments network.

The move involves SoFi Bank migrating its entire card program to blockchain-based settlement, with the expected annualized volume reaching over $25 billion. This is made possible through the use of SoFiUSD, the company's stablecoin, which is fully redeemable 1:1 for U.S. dollars and supported by reserves consisting primarily of cash.

The partnership between SoFi and Mastercard was announced in March, and it allows merchants to receive settlement funds instantly in a SoFi Bank account and withdraw to cash around the clock at zero cost. Merchants do not need to hold stablecoins or change their operations.