At the beginning of August Western Union launched a card. Instead of the recipient queuing at a counter with an ID and a reference number to collect cash (this is how it has worked for 175 years), the money arrives in an app as USDPT, Western Union’s stablecoin, issued by Anchorage Digital Bank on Solana. The recipient can still take the cash if they want it, or they can leave the money in the app and spend it with a Visa card that appears on their phone straight away, anywhere Visa is accepted.
That last part matters. Stablecoins made it possible to send dollars around the world quickly and cheaply, but the recipient would often still have to convert them back into ‘real’ currency before using them. The card removes that step: the recipient can leave the money as a stablecoin and spend against that balance through Visa. Neither the shop nor the customer needs to know that a blockchain is involved.
There is a reason associated with cost for Western Union too. As we wrote in March, to pay out cash on demand across 200 countries, Western Union has to park around $2 billion in local bank accounts in advance, because banks are slow and keep office hours. A stablecoin that stays in the app never has to be parked anywhere.
To do this, Western Union partnered with Rain, which supplies the app wallet, the stablecoin-powered card and the licenses as a single piece of infrastructure. The result is that a stablecoin balance can be spent across Visa’s existing merchant network.
Step by step, stablecoins can now be held, sent and spent without the user having to convert them back into bank money. None of the customers will know that any of this runs on a blockchain, which is of course the point.
This week’s market
- BGCI Index 4.79%
- Bitcoin 3.84%
- Ethereum 5.73%
- Solana 17.61%
All figures are week-to-date as of today 14:00 CET
Blockchain news
- Coinbase debuts tokenized stocks on Base network, joining race to bring equities on blockchain (learn more)
- Hyperliquid Policy Center urges SEC, CFTC to harmonize rules for perpetual contracts (learn more)
- Bitwise Launches Self-Custodied Tokenized Stock Portfolio on Base (learn more)
- U.S. state banking associations plan to launch to launch their own nationwide blockchain network (learn more)
- South Korea trade giant POSCO brings trade receivables to Avalanche in latest tokenization move (learn more)
- Franklin Templeton and Hashkey roll out U.S. tokenized money fund in Asia (learn more)
- Gemini to provide crypto prediction markets venue for Apex’s brokerage clients (learn more)
- Charles Schwab to add Solana, Avalanche and Chainlink to crypto trading platform (learn more)
- Crypto card spending tops $1 billion as stablecoins move into everyday purchases (learn more)
Relevant financial updates
- RQD, a clearing firm expanding its digital asset and tokenization infrastructure, has raised $74mln in a funding round led by Bain Capital
- Fasset, a stablecoin neobank, has raised $68mln in a Series C round led by SBI at a $1bln valuation
- Bitfinex Securities, the tokenized-assets trading platform linked to cryptocurrency exchange Bitfinex, has raised $50mln in a private token sale for tokenized-nickel project Alkemya Metacore
- Entropy, a trading platform focused on deploying new perps markets on Hyperliquid, has raised $14mln in a funding round led by Ribbit Capital
- Beldex, an L1 blockchain, has raised $8mln in a funding round with investments from Sigma Capital and 6 others
- City Protocol*, a tokenization platform focused on structured products, has raised $11mln in a Seed round with investments from Dragonfly, CMT Digital, Mirana, Jump, Bitscale Capital, and Adaverse
- Aligned Layer*, a platform to build financial products on Ethereum, had its TGE and is currently trading at a $118mln FDV
- RockawayX, a crypto investment firm, has acquired hedge fund Relayer Finance
*Underlying TBV portfolio position | Prices as per 28/08
Interesting things to read and listen to
- The anatomy of a stablecoin card swipe (read here)
- Rain CEO Farooq Malik on The Generalist podcast (listen here)