Financial services company MoneyGram International has partnered with the Stellar Development Foundation, a non-profit organization developing Stellar blockchain, to enable consumer’s cross-border transactions using popular stablecoin USD Coin (USDC) and convert directly to and from fiat.
According to an announcement published Wednesday, MoneyGram’s network will integrate with the Stellar blockchain to enable cash funding and payout in multiple currencies, be it a U.S. dollar or Japanese yen, using USD Coin (USDC), a stablecoin governed by Coinbase and Circle through the Centre consortium, according to Denelle Dixon, CEO and executive director of the Stellar Development Foundation.
Dixon notes that a whole segment of cash users will get access to cryptocurrency services that may have previously been out of reach. Customers will be able to convert cash into and out of USDC for instant pickup at MoneyGram locations.
“You can bring in your cash into a MoneyGram location and bring it onto the blockchain, and you don’t have to have a bank account to do that,” she explained. “And the same is true if you don’t have a bank account to pull your assets off of the blockchain like Stellar. [Now] you can do that by going into a MoneyGram location and picking up your cash there.”
On the other hand, Dallas-based FDIC-insured United Texas Bank will facilitate settlement between Circle and MoneyGram. The service is scheduled to launch in select markets by the end of this year, with a further international rollout planned in 2022, though no additional details, including pricing, have been shared.
Working alongside Circle, MoneyGram will also enable “near-instant backend settlement,” account funding and local fiat withdrawals using the USDC stable token.
“We’re enabling consumers to bridge crypto assets and fiat currency, and we think that we can be a pioneer and a leader in that opportunity,” says Alex Holmes, chairman and CEO of MoneyGram International.
MoneyGram’s integration with Stellar comes just months after the firm moved to allow customers to withdraw crypto assets for cash via its point-of-sale outlets in the United States. The service was rolled out in partnership with Bitcoin ATM and crypto exchange operator Coinme.
MoneyGram is no stranger to blockchain technology; it has recently partnered with distributed ledger technology Ripple in June 2019 to collaborate on cross-border payments and foreign exchange settlements with digital assets.
However, the deal quickly went south due to the uncertainty concerning the U.S. Securities and Exchange Commission lawsuit targeting Ripple. MoneyGram suspended support for Ripple’s platform during the first quarter of 2021.
Stellar was launched by Ripple co-founder Jed McCaleb following his tumultuous departure from the project in 2014. USD Coin, which initially developed on the Ethereum blockchain, went live on Stellar in February 2021.