More banks will soon have an avenue to capitalize on crypto, as Fiserv rolls out a digital assets platform and stablecoin that will be available to its customers.
The stablecoin, FIUSD, along with the platform, will be accessible to banks and credit unions by the end of the year. This move is expected to dramatically increase the number of financial institutions that can offer crypto services.
FIUSD will be built on infrastructure provided by stablecoin leaders Paxos and Circle, and will initially be issued on the Solana blockchain. Solana has become the blockchain of choice for financial institutions due to its speed and lower transaction costs compared to Ethereum.
Laster this year, Solana is slated to receive a major upgrade that will not only outpace competing blockchains, but also surpass the speed of the well-established payment rails built by Visa and Mastercard.
Combining Global Reach
With this foray into digital assets, Fiserv hopes to build interoperability with other stablecoins. The company has already unveiled its partnership with PayPal to integrate FIUSD with PYUSD, PayPal’s stablecoin.
PYUSD has been around for two years, and one of its main features is that it’s issued by a payments company—not a crypto company—with a global customer base. Fiserv noted that combining the global reach of Fiserv and PayPal would accelerate the adoption of both companies’ stablecoins.
Actively Expanding Use Cases
While banks and credit unions have increasingly viewed digital assets as a powerful opportunity, compliance concerns have kept many financial institutions on the outside looking in.
A key feature of FIUSD is that it’s built with a compliance-first approach. Fiserv said FIUSD gives financial institutions full control and enables compliance through the company’s existing fraud monitoring, risk management, and settlement systems.
The company also hopes to bring more digital asset offerings to its platform in the future. Tokenization is another technology that financial institutions have incorporated over the past few years—for many of the same reasons stablecoins have gained traction.
Tokenization of real-world assets simplifies transactions that are time-consuming, risky, and expensive for banks. Fiserv is exploring the use of deposit tokens to maintain the benefits of stablecoins in the institutional environment and is in discussions about partnerships to expand use cases.
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