KEY FACTS: Stripe, a leading global payments platform, has launched a U.S. dollar-backed stablecoin product for businesses outside the U.S., U.K., and EU, following its $1.1 billion acquisition of stablecoin platform Bridge in October 2024. Announced by CEO Patrick Collison on X, the product, now in testing, aims to streamline cross-border payments with near-instant settlements and lower fees, leveraging Bridge’s API-driven infrastructure. This move, a decade in the making, positions Stripe to compete in the growing stablecoin market, projected to reach $3.7 trillion by 2030.

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Source: Stripe

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Stripe Tests New Stablecoin Product After $1.1B Bridge Acquisition

Stripe, the global payments powerhouse, is launching a new U.S. dollar-backed stablecoin product aimed at businesses outside the United States, the United Kingdom, and the European Union. This initiative, announced by Stripe CEO Patrick Collison on the social media platform X, marks a significant step in the company’s decade-long ambition to integrate stablecoin technology into its payment infrastructure. The product, built on the foundation of Stripe’s recent $1.1 billion acquisition of stablecoin platform Bridge, is now available for testing, signaling a potential transformation in global payments operations.

Stripe is building a NEW stablecoin product, powered by Bridge, and we're ready to start testing!
If your company is:
🌏 Based outside of the US, EU, or UK
💵 Interested in dollar access
👉 Send a quick note about your company to [email protected]
Source

Stripe’s foray into stablecoins is not a sudden pivot but the culmination of nearly ten years of planning, as Collison revealed in his X post inviting companies interested in testing the solution to join the pilot phase.

“We’ve wanted to build this product for around a decade, and it’s now happening...”
[Source]9https://x.com/patrickc/status/1915788819636584958)

The announcement follows Stripe’s acquisition of Bridge in October 2024, a deal that has been described as the largest crypto-related merger and acquisition to date. Bridge, founded in 2022 by former Coinbase and Square executives Zach Abrams and Sean Yu, specializes in providing application programming interfaces (APIs) that enable businesses to accept and process stablecoin payments without directly handling digital tokens.

The acquisition, valued at $1.1 billion, was a strategic move to boost Stripe’s capabilities in the rapidly growing stablecoin market. Bridge’s infrastructure offers an alternative to traditional cross-border payment systems like SWIFT, which are often criticized for their high costs and slow processing times. With the acquisition of Bridge’s technology, Stripe aims to streamline international transactions, reduce fees, and provide near-instant settlement for businesses worldwide.

Stablecoins, cryptocurrencies pegged to fiat currencies like the U.S. dollar, have emerged as a promising solution for addressing the volatility associated with traditional cryptocurrencies such as Bitcoin. Their stable value makes them ideal for a range of financial applications, from cross-border payments to corporate treasury management. According to a report by Standard Chartered, stablecoin usage in foreign exchange flows could rise from 1% today to 10% in the coming years, driven by the demand for more efficient global transactions.

Stripe’s new stablecoin product is designed to cater to companies in regions with limited access to traditional banking infrastructure or where local currencies are subject to volatility. The product leverages Bridge’s API-driven platform to facilitate seamless conversions between fiat currencies and stablecoins, enabling businesses to manage complex payment flows involving multiple parties and currencies.

Stripe’s move into stablecoins builds on its recent efforts to expand its cryptocurrency offerings. In June 2024, the company partnered with Coinbase to enable fiat-to-crypto conversions, allowing merchants to accept payments in cryptocurrencies like USDC. By October, Stripe had rolled out a stablecoin payment option that was adopted in over 70 countries on its first day. This rapid adoption underscores the growing demand for stablecoin-based solutions among businesses seeking faster and more cost-effective payment methods.

The acquisition of Bridge has further accelerated Stripe’s crypto ambitions. According to Stripe developer Jen Kim, within the first three months of offering stablecoin services, customers from over 90 countries used stablecoins for payments via invoices or checkout processes. This global reach highlights the potential of stablecoins to bridge gaps in financial inclusion, particularly in regions with underdeveloped banking systems.

Despite regulatory bottlenecks, the global stablecoin market is poised for substantial growth. Citi has projected that the market, primarily pegged to the U.S. dollar, could reach $3.7 trillion by 2030 with adequate regulatory support. Ripple executives have forecasted an even more ambitious $2 trillion market capitalization for stablecoins by 2028, suggesting that there is ample room for multiple players to compete. Stripe’s entry into this space positions it alongside fintech giants like PayPal, which launched its own USD stablecoin in 2023, and other financial institutions exploring stablecoin issuance.

Stripe’s stablecoin product has the potential to reshape the payments sector, particularly for cross-border transactions. The acquisition will enable Stripe to offer a low-cost, near-instant alternative to traditional payment rails. With this, Stripe could challenge established players like Visa and SWIFT.

As Stripe opens testing for its stablecoin product, the $1.1 billion bet on Bridge and its decade-long vision for stablecoins shows its commitment to staying at the forefront of the digital payments revolution. It is getting clearer that stablecoins are no longer a niche concept but a transformative force in the financial world.

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Information Sources:

• Stripe CEO Patrick Collison/ X
• BackseatVC/ X
• Cointelegraph
• Yahoo Finance
• CNBC

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