Financial services company Western Union is set to pilot a stablecoin-based settlement system to modernize its remittance operations for its more than 150 million customers.
During Western Union’s third-quarter earnings call, CEO Devin McGranahan stated that the pilot is "focused on leveraging onchain settlement rails to reduce dependency on legacy correspondent banking systems, shorten settlement windows, and improve capital efficiency."
"We see significant opportunities for us to be able to move money faster with greater transparency and at lower cost without compromising compliance or customer trust."
Western Union processes around 70 million transfers each quarter. Blockchain technology could offer significant advantages over traditional remittance rails and could benefit its customers located in more than 200 countries.
The remittance platform’s latest remarks on crypto come a little over three months after it first hinted at plans to integrate stablecoins for cross-border transfers.
McGranahan explained that Western Union initially refrained from crypto due to concerns around volatility, regulatory uncertainty, and customer protection. However, the passage of the GENIUS Act has altered that course.
This announcement also reflects the broader institutional adoption of stablecoins. The stablecoin market recently surpassed $300 billion and is estimated to reach $2 trillion by 2028, according to the US Treasury Department’s April announcement.
Stablecoins Could Benefit Those in High-Inflation Countries
Western Union stated that the stablecoin offering would provide its customers with more choice and control in how they manage and move their money, particularly for those residing in countries experiencing high inflation.
"In many parts of the world, being able to hold a US dollar-denominated asset has real value as inflation and currency devaluation can rapidly erode an individual’s purchasing power. These innovations align closely with our broader strategy to modernize the movement of money."
Competitors Are Also Embracing Stablecoins
Early Warning Services, the parent company of payments platform Zelle, announced that stablecoins will be integrated into Zelle to facilitate cross-border transactions for money flowing to and from the United States.
Meanwhile, MoneyGram confirmed it would soon launch its crypto app in Colombia. This app will allow locals to save in Circle’s USDC (USDC) stablecoin and receive and transfer it overseas nearly instantly.