MoneyGram to launch new service in partnership with Stellar

Wednesday 1 June 2022 09:27 CET | News

MoneyGram has announced it is preparing to launch a service in partnership with the Stellar blockchain that would allow users to send stablecoins and convert them to hard currency.

The move arrives as remittances become more popular in emerging markets, but also as stablecoins come under heightened scrutiny. Once the service fully launches, users with digital wallets on the Stellar blockchain will be able to convert their holdings into Circle Internet Financial’s USDC stablecoin, which can then be cashed out through MoneyGram’s network.

According to Bloomberg, a de-pegging is unlikely to happen with USDC, the stablecoin used in MoneyGram’s partnership with Stellar, because the currency is fully backed by safe liquid asset.

MoneyGram’s new service with Stellar could also help spread crypto usage in emerging markets. For example, El Salvador President has criticised remittance companies for charging hefty fees and said using Bitcoin will save the country USD 400 million a year on money sent home by nationals living abroad. In the US, where remittances abroad total more than USD 100 billion annually, MoneyGram has been accused by New York state and the U.S. Consumer Financial Protection Bureau of delaying international money transfers and failing to disclose prices.

MoneyGram previously worked with Ripple Labs. The partnership between MoneyGram and Ripple ended in March 2021 following a lawsuit filed against Ripple by the U.S. Securities and Exchange Commission in December 2020, alleging that the company held an unregistered securities offering of its XRP token.

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Keywords: stablecoin, remittance, product launch, partnership, blockchain
Categories: DeFi & Crypto & Web3
Companies: MoneyGram, Stellar
Countries: World
This article is part of category

DeFi & Crypto & Web3




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