The race to build global stablecoin payment rails is accelerating as traditional finance and crypto infrastructure companies bet on global money flow.
On Wednesday, blockchain infrastructure provider Fireblocks announced a global stablecoin payment network focused on compliance and connectivity, while Stripe CEO Patrick Collison unveiled Tempo, a new layer-1 blockchain designed for stablecoin transactions.
Fireblocks’ new stablecoin network is focused on interoperability for “programmable, compliant, real-time money movement," said Ran Goldi, Fireblocks’ senior vice president of Payments and Network.
According to Fireblocks, companies exploring stablecoin payments face a patchwork of banking, liquidity and compliance partners that makes scaling difficult. The company says its new network aims to simplify stablecoin adoption by connecting firms to more than 40 pre-vetted providers across 100 countries.
Stripe is also targeting corporate adoption, focusing on gaps that existing blockchains haven’t addressed when it comes to integrating payment services to its existing services.
“For example, it’s valuable for real-world financial applications that fees be denominated in a fiat currency that makes sense to the user, but existing blockchains denominate their fees in blockchain-specific tokens,” Collison said in an X post.
Called Tempo, the network incubated by Stripe and venture capital firm Paradigm. “We think of Tempo as the payments-oriented L1, optimized for high-scale, real-world financial services applications,” Collison said.
Stablecoin momentum continues to increase as the overall market cap for fiat-pegged cryptocurrencies has reached $281.2 billion, according to DefiLlama.
Interoperability has become central to stablecoin strategy, with issuers pushing to launch across multiple blockchains but struggling against fragmented liquidity and dispersed user bases.
In September 2023, crosschain bridge Wormhole integrated Circle’s Cross-Chain Transfer Protocol, allowing USD Coin (USDC) transfers to four blockchain networks.
Related: XRP issuer Ripple sees its RLUSD stablecoin grow among retail users
Stablecoin payment rails face global competition
Fireblocks and Tempo will compete with stablecoin payment rail providers and traditional payment processors like Visa and Mastercard, which have entered the crypto industry in recent years.
In July, Visa announced that it was increasing the stablecoins on its settlement platform. The move was seen as a direct response to competition from financial institutions.
Crypto native companies providing payment networks include Ripple, which announced in August plans to acquire stablecoin payment platform Rail, and Stellar, a decentralized payments network designed to permit cross-border transactions.
In May, new data from Artemis revealed that stablecoin payment volume reached $94 billion, driven by two growing sectors — business-to-business (B2B) transactions and card-linked stablecoin payments.
Stablecoins are considered a form of programmable money and come with benefits compared to traditional fiat currency. Companies that issue stablecoins can reduce friction and counterparty risk by programming logic into money via smart contracts.
Traditional financial institutions have expressed an interest in stablecoins as well. JPMorgan Chase and Citigroup have weighed an entry into the stablecoin sector.
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