MoneyGram Introduces MGUSD Stablecoin on Stellar, Embracing Digital Dollar Payment Trends
MGUSD, launched by Stripe’s Bridge, will enhance services throughout MoneyGram’s extensive global network as stablecoins gain prominence in cross-border transactions.
What to know:
— MoneyGram revealed on Tuesday the launch of its U.S. dollar-backed stablecoin MGUSD on the Stellar blockchain.
— Initially available for U.S. users, the token is set for a worldwide rollout among the firm’s 60 million customers as stablecoins increasingly vie in cross-border payments.
— MGUSD is issued by Stripe-owned Bridge, utilizing smart contracts from M0 and wallet infrastructure from Fireblocks.
MoneyGram announced on Tuesday that it has launched its proprietary U.S. dollar-pegged stablecoin on the Stellar (XLM) blockchain, joining a rising trend of global payment companies and banks developing products centered around digital dollars.
The stablecoin, named MGUSD, will be integrated into the MoneyGram app, enabling customers to maintain a dollar-denominated balance in a self-custodial wallet and transfer funds via the company’s global payment network.
The product was launched in the U.S. on Tuesday, with plans for broader international expansion, as stated by the company.
This initiative by MoneyGram coincides with the rapid growth of stablecoins within the cryptocurrency sector, attracting attention from banks, fintech companies, and payment providers aiming to innovate cross-border payments using blockchain technology. These tokens, whose values are linked to fiat currencies like the U.S. dollar, could provide more economical, swift, and round-the-clock settlements compared to traditional banking systems, making them increasingly favored for remittances. According to global bank Citi, the market size for these assets could soar to $4 trillion by 2030 from the current $300 billion.
Recently, SoFi introduced its internally developed stablecoin SoFiUSD, while firms like PayPal and Western Union have teamed up with crypto infrastructure providers such as Paxos and Anchorage Digital to offer stablecoin services to their clients.
MoneyGram, boasting over 60 million customers and nearly half a million retail locations, is adopting a similar strategy.
The company has partnered with Bridge, the stablecoin infrastructure platform acquired by Stripe, which acts as the regulated issuer of MGUSD. Blockchain infrastructure firm M0 created the smart contracts for minting and redeeming the token, while Fireblocks supplies wallet infrastructure.
«Beginning with our distribution platform, we are leveraging stablecoin as a foundational element to develop future applications on our global network,» stated Anthony Soohoo, chairman and CEO of MoneyGram. «MGUSD is the stablecoin we designed for our customers, for families sending money back home, and for the billions of individuals worldwide with limited access to financial services.»
The company indicated that MGUSD is meant to be a fundamental component of its payment network, which serves over 60 million customers and nearly 500,000 retail locations globally.
This launch builds upon MoneyGram’s collaboration with the Stellar Development Foundation, a partnership that has been focused on stablecoin-powered remittance solutions for the past five years.
«Stellar was designed for practical utility at an institutional level,» remarked Denelle Dixon, CEO of the Stellar Development Foundation. «MGUSD represents the next achievement that showcases what a purpose-built blockchain can accomplish when combined with a reliable payments network.