Money transfer firm MoneyGram is partnering with the Stellar Development Foundation to enable crypto payouts in local currencies for users, according to a Wednesday announcement.
The partnership will see MoneyGram utilize Circle’s USDC to settle payments and convert payouts to a user’s local currency. MoneyGram’s network will be integrated with the Stellar blockchain to settle the USDC transactions, and United Texas Bank will act as the settlement bank between Circle and MoneyGram.
Alex Holmes, MoneyGram Chairman and CEO, said the firm is especially bullish on stablecoins as a way to enable cross-border payment and settlement.
“As crypto and digital currencies rise in prominence, we’re especially optimistic about the potential of stablecoins as a method to streamline cross-border payments,” he said in today’s announcement.
Previously, MoneyGram had a partnership in place with distributed ledger company Ripple. However, it ended that partnership in March of this year as Ripple continued its battle with the Securities and Exchange Commission (SEC) over whether the XRP token constituted an unregistered security.
Despite stablecoins’ promise in cross-border payments, U.S. regulators are intent on taking another look at dollar-pegged tokens. Circle continues to face an investigation from the SEC’s Division of Enforcement, and SEC Chair Gary Gensler recently likened stablecoins “poker chips” in crypto’s Wild West “casinos.” Meanwhile, Acting Comptroller Michael Hsu has said he’s thinking of stablecoin issuers through the lens of the U.S.’s wildcat banking era.
The use of stablecoins is a continuation of MoneyGram’s exploration of crypto services. The firm began accepting bitcoin at its locations in May of this year after inking a partnership with crypto exchange Coinme.
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