Money transfer and remittance firm MoneyGram has announced that it is forming a partnership with Stellar Development Foundation, the non-profit organization leading development and growth for the open-source Stellar blockchain network, and Circle, the blockchain development firm behind the USD Coin stablecoin ($USDC).
The partnership will see Stellar helping MoneyGram enable crypto payouts through local currencies for its users by utilizing Circle’s USDC stablecoin to facilitate and settle payments, and from there convert payouts to a user’s local currency. MoneyGram’s integration with Stellar would likewise enable settlements for these USDC transactions. An additional settlement layer for the process will be provided by the United Texas Bank to connect Circle and MoneyGram.
“Working with MoneyGram allows end consumers to have on- and off-ramps everywhere that MoneyGram’s vast agent network supports this. So this is just transformational in terms of being able to exchange crypto for fiat and fiat for crypto. We’re trying to go as big as we can,” shared Denelle Dixon, CEO and executive director of the Stellar Development Foundation.
The "bridge" between digital assets and fiat currencies for mainstream users is aimed at creating a more connected digital economy through seamless settlements.
7/ That’s powerful. Connecting cash users to the world of digital assets will unlock a variety of use cases. It will help solve existing challenges related to speed and cost. It will also create new value and choices.— Denelle Dixon (@DenelleDixon) October 6, 2021
MoneyGram took headlines earlier this year with its announcement of a partnership with Ripple to utilize XRP for on-demand liquidity (ODL) to help facilitate foreign exchange trading (FX). The partnership, however, was briefly ended, due to Ripple’s legal woes with the Securities and Exchange Commission (SEC) in which it is facing scrutiny regarding the definition of its XRP token as an unregistered security.
“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," shared Alex Holmes, Chairman and CEO at MoneyGram.
According to Holmes, MoneyGram is banking on the growth and scale of stablecoin adoption as a means of enabling cross-border payment and settlement through blockchain technology. Holmes also pointed out that the strategic partnership with Stellar had better promise in terms of scope because it had a direct impact on the consumer payments sector.
“Together, we’re at the forefront of innovation, demonstrating how we can reimagine financial services that benefit and better serve global users.” shared Jeremy Allaire, Co-founder, CEO and Chairman of Circle.
The integrations will begin with a pilot program this year, followed by a phase-by-phase rollout in Q1 of 2022 to MoneyGram’s over 150 million consumers worldwide.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.