Western Union Joins Stablecoin Race, Eyes Crypto Partnerships; CEO Says

Authored by Adrian Zmudzinski via CoinTelegraph.com,

Western Union is exploring ways to integrate stablecoins into its services as the firm seeks to modernize cross-border payments.

During a Monday interview with Bloomberg, Western Union CEO Devin McGranahan said that the company views stablecoins as an opportunity. He also said it is exploring partnerships with major crypto industry players to offer stablecoin on-ramp and off-ramp services, as well as a digital wallet.

“We see stablecoin really as an opportunity, not as a threat. […] We’re 175 years old, and we’ve been innovative across [those] 175 years. And stablecoin is just yet one more opportunity to innovate,” McGranahan said.

McGranahan highlighted three areas where the company may leverage stablecoins: faster cross-border transfers, conversion between fiat and stablecoins and serving as a store of value in unstable economies.

Devin McGranahan talking to Bloomberg. Source: Bloomberg

Western Union is not new to crypto

Western Union is reportedly testing new settlement processes involving stablecoins in Africa and South America. However, this is not the firm’s first foray into crypto.

Western Union filed for three trademarks for crypto-related products as far back as late October 2022. The firm also partnered with Ripple to settle payments of remittances in 2015.

Still, Western Union’s partnership with Ripple remains in the test phase. The company expressed interest in crypto, but announced that it would not be adding crypto transfers to its services in 2018.

GENIUS Act spurs US stablecoin adoption

The renewed interest comes as the United States brings regulatory clarity to the stablecoin sector. The Government Evaluation of New Innovations in the US Act, or GENIUS Act, was signed into law on Friday. The new law creates a national licensing framework for stablecoin issuers.

The GENIUS Act also mandates one-to-one reserves, prohibits unbacked algorithmic stablecoins and subjects issuers to Anti-Money Laundering rules. Stablecoin holders are now also considered senior creditors in case of issuer insolvency.

Dante Disparte, chief strategy officer at major stablecoin issuer Circle, recently said that the GENIUS Act will also prevent technology giants and Wall Street behemoths from dominating the stablecoin market.

He said that any non-bank that wants to mint a dollar-pegged token must spin up “a standalone entity that looks more like Circle and less like a bank.” This is particularly relevant considering that legacy financial institutions are already laying the groundwork for their entry into the stablecoin industry.