R3 LLC and Mastercard Inc. Thursday said they’ve signed a strategic partnership to develop and pilot a blockchain-based cross-border payment solution.

The payment solution will initially focus on connecting global faster payments infrastructures, schemes and banks supported by a clearing and settlement network operated by Mastercard.

“Developing a new and better cross-border B2B payments solution by improving worldwide connectivity in the account-to-account space is central to Mastercard’s ambition,” Mastercard Executive Vice President Peter Klein said in a statement.

The deal is one of R3’s biggest partnerships to date. Although R3 has teamed up with banks on building blockchain platforms for financial markets previously, not all of its development deals have brought blockchain platforms to market. Mastercard could open the door to the massive market of international payment transfers but for how long the partnership is for and to what extent is unknown.

Charles Lu, chief executive officer of fintech toolkit provider the Findora Foundation, told SiliconANGLE that although it’s not clear yet whether the initiatives will go beyond proof-of-concept, they’re a welcome move.

“Tech giants such as Mastercard play an influential role in encouraging the acceptance of cutting-edge technologies and this news is symbolic of Mastercard’s willingness to challenge the status quo and seek solutions to improve current payment systems,” Lu said. “Change is on the horizon and, as technology continues to evolve, we are witnessing cryptographic breakthroughs including zero-knowledge proofs, multiparty computation, and scalability solutions — all of which have the potential to shake up the financial industry as we know it.”

The enthusiasm over the partnership among those in blockchain and cryptocurrency was widespread. Filipe Castro, co-founder and chief information officer at cryptocurrency payments solutions provider UTRUST Switzerland AG, said that the partnership demonstrates Mastercard’s intent to leverage blockchain technology for competitive advantage.

“Payments are a killer app for blockchain, unlike any other due to their mass appeal — a use-case that is especially relevant for the mainstream adoption of digital currencies as a means of payment,” Castro said. “In an age of fast information and instant feedback, where digital and physical augment each other, a universally trusted, verifiable and privacy-conscious means of value transmission will play a pivotal role.”

Sky Guo, chief executive officer of enterprise blockchain solutions firm Cypherium Inc. noted that it’s difficult to distinguish institutional recognition of the technology from “corporate appropriation.”

“On one hand, we can’t survive as new financial systems without meaningful recognition from and conversation with legacy systems, such as Mastercard and other centralized goliaths,” he said. “On the other hand, these technologies — especially the public blockchains — pose a very real threat to the business models of a number of these companies, and in order to quell their disruption, giants like MasterCard want to absorb crypto projects on their own terms.”

Image: R3