Mastercard will score stablecoin payments for scams and sanctions before banks release the money: what Stablecoin Security does

How will banks know if a stablecoin payment is a scam? Mastercard wants to tell them before the money moves. The company announced Stablecoin Security on 19 October at Money20/20 USA in Las Vegas, a service that gives banks a fraud, scam and sanctions risk score before a stablecoin payment completes, according to Analytics Insight. It will launch first in North America, with global availability planned for 2027.

The product addresses the biggest obstacle to banks using stablecoins: the fear of unknowingly moving money for criminals, scammers or sanctioned parties. As banks across Asia, from Hong Kong to Singapore, launch or test stablecoins and tokenised deposits, tools that check where digital dollars came from may become as essential as the coins themselves.

What Stablecoin Security does

The service combines information from traditional payment systems with blockchain data. It examines a payment's source of funds, the transaction details, any links to restricted parties and signs of scams, then produces a risk score before the payment is completed. It also provides information as money moves between traditional currencies and stablecoins, a stage where criminals often try to cash out.

Banks receive the results through an application programming interface and can add them to existing fraud checks, compliance reviews and case management systems. The score helps a bank decide whether to proceed with a transfer or examine it more closely. Ann Johnson, Mastercard's executive vice president of security solutions, said stablecoins create new possibilities for exchanging value, but banks need the right data and controls to take part with confidence.

The timing of the check is the key difference from many existing tools. Much blockchain analysis is used after the fact, to trace funds once a problem has been reported. A risk score delivered before the payment completes allows a bank to stop or hold a suspicious transfer while the money is still under its control, which is far easier than trying to recover funds once they have moved on.

Why stablecoin payments are hard to screen

Mastercard cited research published by the Bank for International Settlements in June. Researchers examined 593 million transfer events within 141 million Ethereum transactions during 2025, covering Tether's USDT, Circle's USDC and PayPal's PYUSD. They found that nearly 60 percent of transfer events appeared within complex transactions involving multiple steps.

That does not mean 60 percent of individual stablecoin payments were complex. But it shows that a single blockchain transaction can bundle trading, lending and other operations alongside a transfer. Looking at the transfer alone may hide the activity around it, which is exactly where money laundering or scam proceeds can be concealed.

Stablecoins move at internet speed, and so do scam proceeds. The bank that can see where a coin came from before it pays out holds the real advantage.

The researchers also found that about a third of the transactions involved multiple event logs and added computing activity, underlining why banks need specialised tools rather than relying on the checks they use for traditional wire transfers.

Traditional bank screening was built for a world of account numbers, names and correspondent banks, where each step in a payment leaves a record with a regulated institution. Stablecoins move between digital wallets on public blockchains, where identities are not always known and funds can pass through many addresses in seconds. Bridging those two worlds is the problem Mastercard is trying to solve.

The partners and the BVNK connection

Borderless.xyz and Keyrails are the first partners. Borderless.xyz connects financial institutions to licensed stablecoin payment providers across more than 113 countries and 72 currencies and helps route payments. Keyrails works on high value international trade payments, including transactions in emerging markets. Both previously joined Mastercard's Start Path blockchain and digital assets programme.

Mastercard also plans to expand the service through BVNK, the stablecoin infrastructure company it acquired in August. On 15 October, Mastercard introduced its Global Money Platform with BVNK, combining accounts for traditional currencies and stablecoins, currency conversion, card spending and local bank payouts through one connection. Mastercard already offers Crypto Credential and Crypto Secure for other checks on digital asset payments.

The choice of partners points to the use cases Mastercard is targeting first. Borderless.xyz sits in cross border payment routing, where stablecoins are often used to move money between countries quickly, and Keyrails focuses on trade payments in emerging markets, where traditional correspondent banking can be slow and expensive. Both are areas where screening is particularly important because funds cross jurisdictions with different rules.

Why it matters for Asian banks

Asia is one of the busiest regions for stablecoin experimentation. HSBC has launched a Hong Kong dollar stablecoin in Hong Kong, as we covered in our report on HSBC's Redcoin launch, and regulators in Hong Kong and Singapore have built licensing frameworks for issuers. At the same time, Southeast Asia is a global hotspot for scam operations that rely heavily on crypto, including stablecoins, to move money.

For Asian banks, that combination creates both opportunity and risk. Stablecoins promise cheaper, faster cross border payments, but banks face strict anti money laundering rules and heavy penalties for sanctions breaches. Global custodians are also moving into the space, as shown by Deutsche Bank's crypto custody plans. The key risks that tools like Stablecoin Security aim to address include:

• Funds linked to scam compounds and fraud networks
• Transfers to or from sanctioned parties
• Money laundering hidden inside complex transactions
• Cash outs where stablecoins convert to traditional currency
• Gaps between blockchain records and bank compliance systems

Competition is also likely. Blockchain analytics firms already sell screening tools to exchanges and banks, and other payment networks are building their own stablecoin services. The winner may be whoever integrates most smoothly with the systems banks already use.

What remains unclear

Mastercard has not published pricing, a date for the North American launch or a country by country rollout schedule. The partners have not said how many transactions they expect to screen or when their customers will begin using it. Those details will determine how quickly banks, particularly in Asia, can adopt it.

The broader direction is clear, though. Payment networks that dominated card payments are positioning themselves as the trust layer for stablecoins, offering risk scores, settlement and conversion services. If banks can screen stablecoin payments as easily as card transactions, one of the main barriers to mainstream adoption could fall.

Another open question is how regulators will view such scores. Supervisors may welcome tools that improve screening, but banks will still be responsible for their own compliance decisions. A risk score is an input, not a guarantee, and banks will need to show regulators how they use it within their wider anti money laundering and sanctions programmes.

Mastercard's Stablecoin Security is an attempt to make stablecoin payments as screenable as card transactions, giving banks a risk score before money moves. Global availability in 2027 coincides with Asia's rapid push into stablecoins and its ongoing fight against crypto enabled scams. If the tool works at scale, it could remove one of the biggest barriers keeping banks cautious about digital dollars.