Western Union is on the verge of launching a stablecoin strategy aimed at transforming its global payment settlement process. CEO Devin McGranahan announced during the company's first-quarter earnings call that the US dollar stablecoin is nearing completion and is expected to launch soon.
The digital currency will operate on the Solana platform and will be issued in partnership with Anchorage Digital, a federally chartered crypto bank. Initially, the stablecoin will be used as an alternative to the existing interbank settlement system, allowing for real-time transactions, including on weekends and holidays, and reducing the need for capital to be tied up in the system.
Additionally, Western Union is developing the Digital Asset Network, which will enable crypto wallet companies to offer Western Union as a cash-out option, allowing users to convert digital assets into local currency. The company also plans to introduce a Stable Card, which will enable customers to hold funds in stablecoins and make purchases through card networks, potentially providing a useful tool in markets with high inflation rates.
This move comes as Western Union's core remittance business faces increasing competition from fintechs and crypto payments firms utilizing blockchain technology for cross-border payments.