Simply put
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Revolut is looking into the possibility of creating its own Stablecoin, according to a source.
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The neobank serves around 55 million retail and 500,000 business customers across 160 countries.
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As new, encryption-friendly laws move through Congress in the US, other major firms are also exploring stablecoins.
Revolut, one of the largest neobanks globally, is reportedly in the process of developing its own Stablecoin, according to sources. This comes as a growing number of companies outside the cryptocurrency space are considering launching their own stablecoins, particularly as regulations evolve in the US and globally.
Based in London, Revolut has recently launched a centralized crypto exchange, which will be available throughout the EU in 2024. Now, roughly a year later, the focus seems to be on their own stablecoin, which could support various crypto ventures, as noted by two sources familiar with these developments.
Currently, the neobank is in discussions with at least one cryptocurrency-focused company regarding this initiative. However, rumors of a breakthrough stablecoin have been circulating for several months, one source shared.
A Stablecoin generally aims to maintain a stable value linked to a fiat currency, often the US dollar. Typically, this is done by backing the coin with actual dollars or other assets. Cryptocurrency traders find stablecoins particularly useful for navigating markets where access to the US dollar is limited or restricted. Plus, they tend to offer lower transaction fees compared to traditional payment methods, allowing for quicker remittances.
In banking and wire services, adopting stablecoins could notably lower fees for payment processors while speeding up transaction resolutions. Additionally, there are potential yield opportunities on the collateral backing the stablecoins in circulation. That’s how firms like Circle and Tether, which issue USDC and USDT respectively, generate substantial profits.
Revolut opted not to comment specifically on its plans for a Stablecoin. However, a representative stated that the company remains dedicated to its role in the cryptocurrency sector.
“We aim to expand beyond being the UK’s most trustworthy and accessible provider, into the EEA and, ultimately, beyond,” the spokesperson mentioned. “Our goal is to significantly enhance our crypto offerings, ensuring a compliance-first approach.”
Revolut claims to cater to more than 55 million retail clients and around 500,000 business customers across 160 nations. Notably, its valuation reached $48 billion in March, a figure revealed when shareholder Schroders increased their stakes in the company. That’s pretty remarkable; it surpasses the market caps of several other well-known entities in the space.
Stablecoins are poised to explode
Recently, reports emerged that big players like Amazon, Walmart, and Expedia Group are considering launching their own Stablecoins.
On another note, Senator Elizabeth Warren has expressed concerns over tech giants creating Stablecoins that could potentially track consumer purchases or misuse data.
The surge in interest towards Stablecoins correlates with the US Senate passing bipartisan legislation aimed at establishing a legal framework for issuing them. Now, the bill is headed to the House, with hopes from some quarters for a signature from President Trump by August.
Bank of America’s CEO, Brian Moynihan, noted that if favorable legislation passes, there may soon be a wave of stablecoins introduced by financial institutions. Other major players, like JP Morgan, Citigroup, and Wells Fargo, are also looking into this space.
Industry experts suggest the market could soon be overwhelmed with a multitude of new stablecoins, leading to an intense competition landscape, particularly against established players like Tether and Circle in this $251 billion sector.
