Western Union has announced plans to launch a stablecoin settlement pilot as part of its initiative to modernize cross-border financial infrastructure. This pilot is set to begin following the passage of the GENIUS Act in the United States, which established a clearer regulatory framework for digital asset operations.
CEO Devin McGranahan shared details about the pilot during the company’s third-quarter earnings call, highlighting the company’s ambitions to move away from traditional correspondent banking systems. The stablecoin pilot will enable on-chain settlements, shortening transaction windows and increasing capital efficiency across their network. It currently processes over 70 million transfers quarterly across 200+ countries.
Purpose of the Pilot Program
The goal of the pilot initiative is to make money transfers safer and faster for Western Union’s 150 million users, particularly those living in nations with high inflation or no access to traditional banking.
Stablecoins serve this purpose because of their price stability and compliance with recent regulations. This provides users with more freedom and control over international payments.
Stablecoin rails’ first testing focuses on treasury and remittance use cases, with the goal of extending digital wallet functionality in regions like Southeast Asia, Africa, and Latin America, where remittance volume and cryptocurrency usage are on the rise.
Industry Shifts Drive Move by Western Union
Western Union’s move into stablecoin settlement is part of broader digital transformation efforts among major payment companies. Competitors like MoneyGram and Remitly have already piloted stablecoin and crypto wallet products to address consumer demand for quicker, cheaper cross-border services.
Average global remittance fees remain around 6.6%, but stablecoins could reduce this by as much as 50%, easing the cost burden on families and workers sending money internationally.
Regulatory vigilance remains a priority for Western Union, with compliance features built into the stablecoin system. The GENIUS Act mandates that stablecoins must be fully backed by liquid assets and undergo regular audits for large issuers.
Senator Elizabeth Warren and other regulators are pushing for the swift implementation of these safeguards to avoid systemic risks and support consumer protection as stablecoin usage expands.
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