After acquiring a banking license, Revolut reveals its next step to enter the stablecoin market.

The fintech giant Revolut, after obtaining a banking license in July, has been making frequent moves. It has recently announced its entry into the stablecoin market, competing with Tether, Circle, PayPal, Ripple, and BitGo. Despite Revolut's long-standing reputation for being extremely crypto-friendly, its foray into the stablecoin business still comes as a surprise.

Obtaining Banking License Gives Revolut a Competitive Edge in Stablecoin Development

According to reports, Revolut obtained a banking license in July this year and is rumored to be launching stablecoin services soon. When asked about their stablecoin plans, a spokesperson for Revolut stated that the company aims to expand its cryptocurrency offerings in a compliant manner, becoming a safe haven for the entire cryptocurrency community.

Cryptocurrency is a key part of our borderless banking ethos, and we have a clear mission to become the safest and most accessible provider of crypto asset services.

While Revolut has always been crypto-friendly, allowing users to buy and sell cryptocurrencies within its app, and launching a crypto exchange service for experienced traders in May this year.

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Stablecoin Market Sees Competition as Multiple Institutions Enter

The stablecoin industry is dominated by Tether's USDT with a market cap of around $119 billion. Circle's USDC ranks second, with a scale about a third of Tether's. Last year, payment service PayPal began issuing stablecoins, and blockchain company Ripple plans to join in the coming weeks, while BitGo announced the launch of stablecoin services at the Token2049 event held earlier this week in Singapore, set to go live in 2025.

Tether made a profit of up to $5.2 billion in the first half of the year, prompting many challengers to try to carve out a share of the market. However, it's not that easy, as in the case of the European market, the MiCA regulatory framework tightens the noose for giants like Tether without banking licenses. Starting from June 30, 2024, MiCA stipulates that only Electronic Money Institutions (EMIs) and credit institutions (such as banks) can issue and provide stablecoin services within the European Economic Area (EEA).

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On the other hand, the UK, where Revolut is headquartered, has shown a keen interest in Central Bank Digital Currency (CBDC) recently. This optimism indicates that the current Labour government is likely to maintain an open attitude towards blockchain applications. Revolut is also a favorite for many students studying in Europe, with its convenient instant currency exchange feature and fully online account opening, making it a must-have for those living in Europe. Perhaps in the near future, we will see more people using cryptocurrencies to achieve more convenient cross-border financial services.

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