The relationship between traditional finance and cryptocurrency has been uncomfortable for years.
But with regard to Fintech societies, it was an entirely different story. Many of the main platforms have adopted blockchain products, positioning them at the center of their offers. The cryptographic products they adopt and integrate? Stablecoins and financial services tend to dominate the list.
Take for example the last Stripe stage shareholder letterwhich includes an entire section on stablecoins as “superconductors at room temperature for financial services”.
“The main cases of using the stable reserve today involve a tangible and real activity. Financial directors use stablescoins to manage the corporate treasure, immigrants use them for discounts, citizens of unstable currencies use them for reliable savings and payment teams use them to allow customers of countries with low card penetration, “wrote the Fintech platform.
While banks operate under a rigid and very examined regulatory environment, making any foray into intrinsically complex cryptography, for fintech companies, the regulatory charge is less expensive. Many operate under license of monetary issuer (MTLS) rather than in complete banking charter, allowing them to offer crypto services with less capital and compliance constraints.
On the other hand, banks must face various capital requirements, which discourage high volatility assets such as cryptocurrencies from being detained on assessments. This disparity can give the Fintech a significant advantage in the development of payment solutions based on cryptography without the same level of regulatory friction or charter.
Learn more: Visa, paypal and others could provide public services and legitimacy to stablecoins
Why the fintechs exceed banks in the adoption of cryptography
Despite the growing institutionalization of digital assets, banks are largely on the sidelines, while Fintech companies are inviting more and more cryptography offers.
The reason lies in the intersection of regulations, the appetite for risks and structural agility. Fintechs, tirelessly by the restrictions of traditional banking charters, take advantage of their regulatory flexibility, their demand from customers and their technological prowess to advance. Meanwhile, the banks, which must respect the compliance requirements and conservative risk frames, move with caution – if at all – in cryptographic space.
However, some companies, such as Block (formerly Square), have adopted a hybrid approach, guaranteeing both the MTL and the state banking charters to fill the gap between traditional and digital finance. This approach allows them to treat cryptocurrency transactions, provide childcare services and facilitate stabing payments with greater agility than banks.
Even new fintech entrants like Revolut and Robinhood have expanded their cryptocurrency offers to stay competitive, while Klarna is ready to “kiss crypto” and ask crypto fans to share ideas on how they can do it.
Another factor fueling the adoption of the cryptography of fintech is regulatory arbitration. Unlike banks, which must join strict national banking laws, Fintech companies can establish operations in jurisdictions with more user -friendly regulations in crypto. Countries like Switzerland, Singapore and Malta have actively encouraged the innovation of digital assets, attracting fintechs looking for regulatory clarity and favorable operating conditions.
Some cryptocurrency companies based in the United States, such as Coinbase and Circle, have continued global regulatory strategies to maintain a crypto foot while sailing on interior restrictions.
Learn more: The guide of the professional payments on stablecoins
The future of the adoption of cryptography
What are the fintechs doing with their cryptocurrency offers? According to the Stripe shareholders’ letter, SpaceX uses Bridge to repatriate Starlink sales funds in Argentina, Nigeria and other markets. Dolarapp, a Neobank in Mexico, uses Bridge to help individuals receive USD payments from pay suppliers like Deel. Airtm uses Bridge to pay payments to workers from all of Latin America.
Wednesday March 5 ,, Bvnk Launched what he calls the first integrated Fiat and Stablecoins integrated portfolio on a global scale.
Beyond stablecoin payments, financial services are also introduced into the mixture. Last week (February 26), Finance Ondo announced that this will be the first supplier to provide real assets MasterCard Multi-token network (MTN). Ondo said that its short -term American government treasure fund (OUG) – The first real tokenized active active (RWA) on the Mastercard network – will allow companies to gain daily yield via token assets with 24/7 subscriptions.
Also last week (February 27), Flexa Adding Tot-to-Pay care to its digital currency acceptance platform, allowing users to pay with crypto in retail locations using NFC compatible material portfolios.
The Pymnts also covered last month (February 14) how sports betting and the Igaming Draftkings platform expressed interest in providing crypto payments and payments, once the regulatory environment becomes clearer.
