London-based fintech company Revolut, which recently obtained a U.K. banking license and is valued at $45 billion, is reportedly developing its own stablecoin.
Four individuals familiar with the matter told CoinDesk that the project is already well advanced.
When asked about the stablecoin plans, a spokesperson for Revolut confirmed that the company intends to expand its cryptocurrency offerings with a compliance-first approach to becoming a safe harbor for the crypto community.
“Crypto is a big part of our belief in banking without borders, and we have a clear mission to become the safest and most accessible provider of crypto asset services,” the spokesperson said.
The stablecoin market, currently led by Tether’s USDT with a market cap of around $119 billion, is seeing new entrants. Circle’s USDC ranks second, with a market cap about one-third the size of Tether’s.
Recently, PayPal entered the stablecoin sector, and blockchain firm Ripple is expected to follow suit soon, alongside BitGo’s upcoming launch announced at Token2049 in Singapore.
Stablecoins are typically pegged to real-world assets, such as fiat currencies, and are backed by reserves like government-issued debt, which generates interest income. This makes them highly profitable. Tether, for instance, reported a first-half profit of $5.2 billion in 2023.
The rise in stablecoins is also driven by regulatory clarity in Europe, particularly the Markets in Crypto Assets (MiCA) framework. Revolut has allowed crypto trading within its app for several years and launched a standalone cryptocurrency exchange for experienced traders in May.
The move comes shortly after Revolut finally obtained a UK banking license more than three years after Britain’s most valuable fintech firm lodged its application with regulators in its home market.
This license will enable Revolut to hold customer deposits and offer lending products like credit cards, personal loans, and mortgages.
Despite the milestone, Revolut faces certain restrictions and cannot immediately launch new products in the market. The company has entered a “mobilisation” stage, a period where new banks must complete building their banking operations before a full launch.
During this time, Revolut can hold only £50,000 of total customer deposits. The exact duration of this stage remains unspecified.
Founded in 2015, Revolut has grown to serve 40 million customers globally, with 9 million in the UK and over 2.8 million in Ireland. The firm plans to expand its workforce to 11,500 by the end of 2024.
