After severing ties with Ripple Labs in the first quarter of the year, MoneyGram has inked another partnership with Stellar Development Network. Stellar Development Foundation, a non-profit corporation based in Delaware, struck a deal with the Dallas-headquartered payment service form to facilitate payments using Stella’s native token USD Coin.
USD Coin was launched on the Stellar network around February, becoming the second-largest stablecoin. According to reports, the coin would be used as a currency for payments and allow users to fund their accounts, withdraw, and access MoneyGram’s retail features.
Texas Bank Will Settle the Transactions
MoneyGram states that it has added support for withdrawing in fiat currencies and account funding. Users’ crypto wallets will be connected to the Stella blockchain, allowing them to access its retail platform. United Texas Bank will reportedly be responsible for facilitating the transactions, acting as the settlement bank, and ensuring that the stablecoin is converted to cash and vice versa.
The collaboration’s first phase will be launched before the end of the year. However, it’s unclear when the service will be fully rolled out for worldwide use, although both firms are working towards a rollout in 2022. In an interview with Forbes, CEO of Stellar Network Denelle Dixon, said that the partnership with MoneyGram will focus on the end-user experience, emphasizing that it isn’t just an alternative to on-demand liquidity.
MoneyGram’s Scored its First Crypto Deal with Ripple
MoneyGram made its debut in the crypto industry when it scored a deal with Ripple Labs in 2019. The deal was to enable cross-border payments and foreign exchange settlements with XRP. However, the partnership went south after the SEC accused Ripple of not registering XRP as security, resulting in several blockbuster suits that as have come to witness till this day. MoneyGram parted ways with Ripple in 2021.
Other financial service companies that have added support for crypto payments are PayPal, Visa, and MasterCard. In March, PayPal enabled its users to make payments in Bitcoin using the various online merchants on the platform. After announcing its corporate program to expand innovation and provide businesses with all the information needed to develop blockchain-based projects, MasterCard stated that it would enhance its card program to facilitate payment transactions in digital assets. MasterCard went ahead to urge banks to provide a card option for users intending to spend their cryptocurrencies where MasterCard is accepted.
Stellar Foundation was founded by Jed McCaleb, following his controversial departure from Ripple Labs in 2014. SDF was formed to aid in the development of the Stellar Network and create seamless access to the financial service system.