MoneyGram has partnered with Stellar to facilitate payments via blockchain and ensure virtually instant transitions in USDC.
A deal that benefits Circle
It was Stellar that announced the agreement with MoneyGram, the P2P payments giant.
The partnership is designed to allow users to use USDC, Circle’s stablecoin. Consumers will be able to convert USDC into cash instantly, and vice versa. Using Stellar’s blockchain, MoneyGram will be able to guarantee real-time money transfers, leveraging USDC.
The two companies expect their agreement to lead to growth for both, in particular, it is expected to accelerate the spread of digital assets. Stellar’s partnerships and those who choose to use its blockchain should also contribute to this.
The agreement will be operational as early as this year in some markets. It is set to expand its horizons in 2022.
MoneyGram pioneers innovation
Alex Holmes, president and CEO of MoneyGram, commented on this partnership as follows:
“At MoneyGram, one of our top strategic priorities is to pioneer cross-border payment innovation and blockchain-enabled settlement, and we’re thrilled to now work with the Stellar Development Foundation to further our efforts”.
The agreement shows that MoneyGram believes in the potential of digital currencies. Holmes adds in this regard:
“As crypto and digital currencies rise in prominence, we’re especially optimistic about the potential of stablecoins as a method to streamline cross-border payments. Given our expertise in global payments, blockchain, and compliance, we are extremely well-positioned to continue to be the leader in building bridges to connect digital currencies with local fiat currencies”.
Denelle Dixon, CEO and executive director of the Stellar Development Foundation added:
“This partnership is a shining example of how blockchain technology and stablecoins bring new opportunities to global customers and enhance the existing financial system. Thanks to the reach of MoneyGram’s services and the speed and low cost of transactions on Stellar, a new segment of cash users will be able to convert their cash into and out of USDC, giving them access to fast and affordable digital asset services that may have previously been out of reach. We’re pleased to team up with MoneyGram to drive toward our mission of creating more equitable financial access”.
For its part, Circle will be seizing a huge opportunity to expand USDC’s reach. In this regard, Jeremy Allaire, co-founder, CEO and president of Circle, says:
“The launch of this partnership speaks to the power of digital currencies like USDC to create fast, secure, and seamless settlement for the digital economy. Together, we’re at the forefront of innovation, demonstrating how we can reimagine financial services that benefit and better serve global users”.
MoneyGram from Ripple to Stellar
MoneyGram is no stranger to partnerships with blockchain companies. In fact, the first agreement was signed with Ripple. It was in 2019 and the two companies, which were both looking to establish themselves in the cross-border payments sector, entered into an interesting collaboration. Similar to what will happen with USDC, at the time of the partnership with Ripple the asset for instant payments was XRP.
The use of USDC is probably better suited to this purpose. The use of a stablecoin ensures that the asset being traded does not fall prey to volatility and this may encourage its use.
The agreement with Ripple was for two years and was not renewed. The decision was also influenced by the uncertain fate of the XRP token due to Ripple’s lawsuit with the SEC.
In the official announcement, the companies said they would like to resume their relationship in the future, as they both said they believed in the potential of digital assets and blockchain.
But now MoneyGram has chosen Ripple’s number one rival, Stellar. At number 22 in market capitalization, the news of the partnership with MoneyGram has done well for the XLM token, which today gained 14% and rose to $0.36.