MoneyGram, one of the leaders in the inter gram border payment and remittance market, uses the Stellar Blockchain to partner with the Stellar Development Foundation. The company will use USD Coin (USDC), a popular stable coin, to make the process of sending remittances easier and faster. This also means that MoneyGram will act as a Fiat on and off-rampamp service for USD coin users.
MoneyGram will use crypto for remittances
MoneyGram, a Dallas, Texas-based payment and remittance company, has announced a partnership with the Stellar Development Foundation, the development and growth arm of the Stellar Blockchain, to facilitate payment settlement and remittance. The company will use the native version of USDC on the Star blockchain to move funds in a more convenient and efficient way.
However, neither MoneyGram nor Circle is a bank. United Texas Bank will act as a settlement bank between Circle and MoneyGram, acting as a link between the two institutions.
MoneyGram now uses USD coin users as a way to get Fiat funds, and vice versa, adding value to the USDC ecosystem. MoneyGram was one of the first remittance companies to integrate the blockchain when it announced a partnership with Ripple. However, the partnership was dissolved after the SEC announced that it would take legal action against the company in December 2020.
Easy, fast and cheap
The new system implemented by the company is expected to allow an underlying instability due to the almost instant settlement time and stable coin use with low fees for the use of the Stellar blockchain. Regarding the importance of these devices, MoneyGram CEO Alex Holmes said:
As crypto and digital currencies predominate, we are particularly optimistic about the possibility of a stable currency as a way to facilitate payments across borders … We are in a very good position to lead in building bridges to connect digital currencies with locals. Fiat currency.
According to Circle, this partnership will contribute to reducing costs related to remittances. This is one of the UN’s proposed Sustainable Development Goals, which aims to reduce remittance costs from %% to %% of remittance funds. It will be interesting to see if cryptocurrency can help achieve this goal in the short term.
What do you think about MoneyGram’s partnership with the Stellar Development Foundation? Tell us in the comments section below.
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