Western Union is researching the use of stablecoins to update its cross-border payment services. CEO Devin McGranahan noted stablecoins as an "opportunity," emphasizing intentions to collaborate with prominent crypto firms to provide stablecoin on- and off-ramp services, as well as a digital wallet.
The company intends to use stablecoins for faster global transfers. They also believe it will facilitate the conversion of fiat to stablecoins and serve as a secure store of value in unstable economies. The financial powerhouse is currently piloting stablecoin-based settlement systems in Africa and South America.
Western Union's involvement in cryptocurrency is not a new development. The company had previously filed for crypto-related trademarks, collaborated with Ripple to test blockchain-based remittances, and expressed interest in the sector as far back as 2015.This renewed push comes as US officials work to stabilize the industry. The recently signed GENIUS Act establishes a national licensing system for stablecoin issuers, requires one-to-one reserves, prohibits unbacked algorithmic stablecoins, and broadens anti-money laundering regulations.
Stablecoin holders are now considered senior creditors if an issuer becomes insolvent. The law also aims to prevent tech behemoths from monopolizing the market by requiring any non-bank stablecoin issuer to form a separate entity, similar to Circle, rather than a traditional bank.
