MoneyGram plans to launch digital wallet for crypto assets
Global payments and wire transfer services company MoneyGram International Inc. is doubling down on its cryptocurrency leanings with an announcement Tuesday that the company will soon offer a noncustodial wallet for customers to hold crypto assets such as bitcoin, Ethereum and USD Coin stablecoins.
A stablecoin is a cryptocurrency that is “pegged” to match a traditional currency, and in the case of USDC it maintains parity with the United States dollar. That means there’s no risk of volatility when trading between USDC and dollars, so users can use cryptocurrency exchanges without concern for losing value.
A noncustodial wallet is a type of wallet that provides complete control of crypto tokens to the user and not a third party. Users maintain control over the cryptographic keys that allow them to transfer the tokens from their wallets. These types of wallets have become a primary way for major banks and financial institutions to allow users to keep crypto without incurring regulatory risks by holding customer digital assets.
One of the benefits of stablecoins is that they allow for simplified cross-border payments and wire transfers without the need for going through complex processes in order to get money moved. Once launched, the wallet will allow any participating user to visit any MoneyGram location and cash-out their digital assets.
The move follows MoneyGram’s work with the Stellar Development Foundation to build a network that would allow customers to send money instantly using USDC with a pilot program that launched in 2022. The partnership gave customers the ability to exchange money for USDC at participating MoneyGram retail outlets, but they had to bring their own digital wallets for the process. In November, MoneyGram expanded its program to allow users to buy and sell a larger variety of digital assets, such as bitcoin, Ethereum and Litecoin.
“Our vision to connect the world’s communities, by empowering our customers through innovative financial solutions, takes another step forward today.” said MoneyGram Chief Executive Alex Holmes. “Through the services we provide in partnership with SDF, MoneyGram has made strides to create equitable access to the global financial system.”
The company said it plans to roll out the new wallet in 2024 and it will allow users to cash out their assets in more than 180 countries and cash in assets in more 30 around the world. The service will be provided as a zero-fee service until June 2024.
PayPal Holdings Inc. launched its own PayPal USD stablecoin in early August, which allows U.S. customers to fund purchases during checkout and even make person-to-person payments. PayPal also allows users to transfer their PYUSD out of PayPal to compatible noncustodial wallets and cash it out in the app.
Image: geralt/Pixabay
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