Stablecoins, which are cryptocurrencies tied to things like the U.S. dollar, are changing the way money works around the world. In a recent interview with Bloomberg, Devin McGranahan, the CEO of Western Union, said that stablecoins are an “opportunity, not a threat” for the 175-year-old money transfer company.

The GENIUS Act, a new law in the U.S., brings clarity to regulatory frameworks, signaling a significant shift in how traditional banks approach digital currencies

Stablecoins: A Big Deal for Payments Across Borders

McGranahan said that stablecoins make cross-border transactions faster and cheaper, which is in line with Western Union’s goal of making global money transfers easier. Blockchain-based stablecoins settle transactions almost instantly and incur lower fees compared to traditional systems, which tend to be slow and expensive.

This efficiency could improve Western Union’s services, especially in places where sending money costs a lot, such as where the average price is 6.6% worldwide.

Changing Stablecoins into Fiat

The real challenge lies in converting stablecoins to spendable cash, particularly where local currencies are scarce. McGranahan said, “Last I checked, you couldn’t spend stablecoin if you wanted to buy a Coca-Cola.” Western Union is tackling this issue by seeking partnerships for on-ramp and off-ramp solutions, making it easier for customers to buy and sell stablecoins

Stablecoins as a Store of Value

Stablecoins offer a safe haven for savings in economies with high volatility. According to McGranahan, Western Union’s digital wallets could potentially support stablecoins, allowing customers to hold assets that retain their value despite local currency fluctuations. This might bring in consumers from places like Latin America and Africa, where the business is currently testing new ways to settle payments.

The recent approval of the GENIUS Act in the U.S. has made Western Union more confident about stablecoins. The law sets up a system for issuing stablecoins, which will be watched over by the Federal Reserve and the Office of the Comptroller of the Currency.

This transparency makes things less risky for conventional organisations, which makes them more likely to embrace it. McGranahan’s proactive position is different from the worries of people like Bank of England Governor Andrew Bailey, who says that stablecoins could pose a risk to financial stability if they are not properly regulated.

Western Union’s Change in Strategy

Western Union is looking for collaborations with infrastructure providers to integrate these assets to its platform. This might include stablecoin leaders like Circle or Tether. The company wants to become a leader in the changing fintech market by using its global network to make currency conversions easier and improve its digital wallet services.

Western Union doesn’t fear disruption; instead, it sees stablecoins as a way to drive innovation. The startup aims to enhance cross-border payments, provide conversion services, and provide clients worldwide with a stable value store by embracing these digital assets. As rules become more stable, Western Union’s strategy shift could change its place in the world of finance.