Fiserv's stablecoin
Add Axios as your preferred source to
see more of our stories on Google.
Another major firm has entered the stablecoin economy, the payments giant Fiserv.
Why it matters: Fiserv is a 40-year-old firm wired into the economy of 100 countries, directly serving thousands of merchants and a slew of global financial institutions.
- Stablecoins look set to go mainstream this year, with the U.S. Congress finally taking action to create clear rules for the instruments.
Driving the news: The $96 billion company announced its intention yesterday to launch its own stablecoin, FIUSD.
- "We're working to get into the arena by helping customers that we already work with be able to access digital assets as a form of payment," Sunil Sachdev, Fiserv's embedded finance lead, tells Axios.
Between the lines: Fiserv is looking to give its customers more options for payment and treasury management.
How it works: FIUSD will run on the Solana blockchain, accessible to regular people and institutions alike.
- Under the hood, it will run on existing stablecoin infrastructure, likely either Circle's USDC or Paxos' USDG (or both).
- Fiserv will rebrand these tokens to FIUSD to give its customers confidence, but it will also add some features to the token that will work well with its existing system.
- Particularly, it plans to wrap more data into each transaction with FIUSD, which they believe will make it more useful for their customers.
Fiserv also announced plans to make FIUSD interoperable with PayPal's PYUSD. Sachdev explained that this basically means "convertibility."
- The blockchain-based stablecoin USDS, of the Sky Network, does something similar with Circle's USDC, via what it calls its "peg stability module."
What we're watching: If the FIUSD plan works well, Fiserv won't stop here. Tokenized deposits are a likely next step. After that, they could get into on chain services.
The intrigue: What's attracted most companies to the stablecoin space is seeing the dramatic profits issuers generated off the massive reserves that insure its peg.
- That's not Fiserv's plan, so far. By using other companies' stablecoins, they are passing on the opportunity to earn those returns if FIUSD becomes popular.
The bottom line: "We're not looking to make money off of yield," Sachdev said.
- "We want to unlock commerce with stablecoins."
The latest: Mastercard announced today it would use Fiserv's new stablecoin.
