MoneyGram to Support Stablecoin Transfers
CEO gives Crypto a vote of confidence
MoneyGram, is one of the leading money transfer services worldwide. In the last couple of months, users of the service provider have been clamoring for crypto acceptance and it seems like they are finally getting their wish. MoneyGram is to introduce a new service that would allow consumers to send money internationally using stablecoins.
Users will be able to change their stablecoins to actual cash at MoneyGram agent locations thanks to a cooperation with the Stellar (XLM) blockchain, a decentralized system specialized in cross-border transfers.
“The world of crypto and the world of fiat are not really compatible today,” MoneyGram CEO Alex Holmes said in a statement. “We’re trying to be a bridge from the crypto world to the fiat world.”
This effort comes at a time when stablecoins, or cryptoassets that strive to maintain a peg with fiat currencies, have come under renewed attention following the controversial de-pegging of Terra (LUNAdecentralized )’s stablecoin UST, which resulted in the ecosystem’s collapse.
The breakdown of the Terra ecosystem had a knock-on impact throughout the sector, resulting in a crypto market meltdown. Bitcoin (BTC) is currently trading slightly above USD 30,000 as at the time of writing this report, down about 21% in a month and over 55% from its all-time high.
Similarly, Ethereum (ETH) is presently trading at USD 1,905, down 32.5 percent in a month and 61 percent from its all-time high.
Despite the uncertainties surrounding crypto, Holmes is optimistic about the future of digital currency.
Cryptocurrency “is obviously here to stay and it’s going to be here for a long time despite recent selloffs and volatility,” he said. “I think adopting it, bringing it into the mainstream is important.”
MoneyGram announced its alliance with Stellar in October 2021, revealing intentions to establish rapid money transfers utilizing the USD currency (USDC) stablecoin, as previously reported.
MoneyGram had a cooperation with Ripple, a prominent remittance network, prior to collaborating with Stellar. MoneyGram was able to use Ripple’s platform for cross-border payments and foreign exchange settlement once the cooperation was signed in 2019.
A New Movement
MoneyGram’s latest endeavor comes at a time when remittances are becoming increasingly popular in emerging economies. Remittances to low- and middle-income nations grew to USD 589 billion last year, according to the World Bank, as quoted by Bloomberg, and are expected to rise even more this year.
Remittances and digital currencies have also become more intertwined. Countries such as El Salvador, who accuse money transfer providers of charging excessive fees, have made Bitcoin legal tender to facilitate faster money transfers.
“There are billions of cash-dependent people globally who could benefit from the utility that digital assets and blockchain provide,” said Denelle Dixon, CEO of the Stellar Development Foundation, adding: “The answer is what we’re building through this partnership — a service for helping them go from cash to digital assets.”