Stablecoins are the fastest growing digital asset. They’ve attracted interest and investment from the likes of Visa and PayPal, and they’ve been called the next frontier in cross-border payments by industry analysts.
Stablecoins are the fastest growing digital asset. They’ve attracted interest and investment from the likes of Visa and PayPal, and they’ve been called the next frontier in cross-border payments by industry analysts.
So, what’s all the fuss about – and how are fintechs using them?Hi I’m Kartik and in this video, I’m going to talk about use cases of stablecoins for fintechs. Stablecoins, for example USDC and USDT, are digital currencies, but unlike others, their value is pegged to a fiat currency like the US dollar.
They’re less than a decade old, but 11 trillion dollars of stablecoins have been settled on blockchains just in 2022.
The influence of stablecoins on global money movement is growing. Today they account for nearly 70% of transactions on the blockchain, eclipsing more established digital currencies like bitcoin.
But how can they be used by fintechs?
Firstly, stablecoins make a great high-speed rail for cross-border payments.
Which is why many fintechs use them as an alternative to the Swift banking system. For example, rather than sending money from Asia to Europe using Swift, you could do it on the same day and likely for lower fees, by converting the Asian currency into stablecoins, and those stablecoins into Euros.
Secondly, because they’re efficient, stablecoins are now used to settle business payments.
As a B2B fintech, giving your merchants access to stablecoins means they can:
- accept and send payments in new markets where other options might be slow or expensive. OR
- hold funds in stablecoins to reduce their exposure to currency risk.
So effectively, doing this helps you become a one-stop shop for your merchants’ payment needs.
While navigating regulation and compliance can be complex, there are now simpler ways to deliver stablecoin services in partnership with licensed providers.
That means you can offer these services in your own platform using a proven API layer and without taking on the technical or compliance overheads, or compromising on the customer experience.
