Digital Transactions Authoritative, insightful and timely information for payments professionals
MoneyGram International Inc. on Wednesday unveiled a mobile app featuring a U.S. dollar-backed stored-value account that will work with stablecoins as well as fiat currencies. The move, which comes as interest in stablecoins heats up in the mainstream payments market, represents a sweeping update of the remittance company’s mobile technology and comes, in the company’s words, as “a fundamental reinvention of cross-border finance.”
The company behind the new app’s technology is Crossmint Inc., which said Wednesday it will work with MoneyGram to support the remittance company’s stablecoin-based cross-border payments service. Crossmint’s platform, which features tokenization capability to mask sensitive payments details, develops digital wallets.
MoneyGram’s announcement comes in the wake of rival Western Union’s own expressed interest in cryptocurrency. Devin McGranahan, the company’s chief executive, said last month Western Union is investigating the possibility of issuing its own stablecoins, with special emphasis on the U.S. market.
The move by MoneyGram also follows major legislation passed by Congress this summer that helps clear the way for stablecoins in the U.S. market. The GENIUS Act, which became law July 18, offers stablecoin players an opening for issuance and acceptance by clarifying relevant law, observers say.
The new app’s reliance on stablecoins will simplify and hasten cross-border transfers for MoneyGram users, the company said, with recipients receiving funds in U.S. dollars into their smart phones. The app will first launch in Colombia, which MoneyGram says is a “major inbound remittance corridor.” Other geographic markets will follow, MoneyGram says, without specifying a timeline.
MoneyGram’s announcement comes as other players begin moving into digital currency in the wake of the GENIUS Act’s passage. Rain Financial Inc., a provider of cards backed by stablecoins, said Thursday it will look to expand by working with Lithic Inc., a specialist in card-issuing technology. The alliance is aimed at removing complications for businesses interested in launching and growing global card programs based on stablecoins, the company said.
“Stablecoin-powered cards are a major growth frontier in payments, and Rain is at the forefront of making them work at scale,” said Bo Jiang, chief executive and cofounder of Lithic, in a statement.
