Alex Holmes — the CEO of remittances giant Moneygram International Inc. (NASDAQ: MGI) — said that the firm is "trying to be a bridge from the crypto world to the fiat world."
What Happened: MoneyGram is preparing to launch a service based on the Stellar (CRYPTO: XLM) blockchain which would leverage stablecoins to carry out remittances, according to a Sunday Bloomberg report. During an interview, Holmes admitted that "the world of crypto and the world of fiat are not really compatible today," but promised that the firm is trying to move the two closer.
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When MoneyGram's new service launches, the platform will be using USD Coin (CRYPTO: USDC) — the stablecoin jointly launched by fintech Circle and crypto exchange Coinbase (NASDAQ:COIN) Global Inc. (NASDAQ: COIN) — on the Stellar blockchain to quickly move value around the globe. The company would then allow users to cash out the stablecoins for fiat currency through its own network.
The move comes amid heightened regulatory scrutiny after major cryptocurrency Terra (CRYPTO: LUNA) collapsed and lost over 97% of its value as its native stablecoin TerraUSD (CRYPTO: UST) fell to under $0.30. The losses amounted to nearly $24 billion of capital evaporating from the two tokens' market capitals, all within 24 hours.
While the fall of TerraUSD caused fears over the collapse of other stablecoins, Benzinga's analysis highlighted that USD Coin has very different implementation means that it could not fall in the same way TerraUSD did — at least not for the same reason.
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