We outline the market outlook for fiat-backed stablecoins in the financial services industry — from investment trends and leading companies to recommendations for the players in the space.
What is a fiat-backed stablecoin?
Fiat-backed stablecoin companies in this market issue stablecoins collateralized by fiat currency. Fiat-backed stablecoins are backed at a 1:1 ratio, meaning 1 stablecoin is equal to 1 unit of currency. For each stablecoin that exists, real fiat currency is held in a bank account.
Features & capabilities
Fiat-backed stablecoins provide payment leaders with several capabilities, including the following:
- Decentralized mobile wallet
- Lower-cost payouts
- Credit card processing
- Automated clearing house debit transactions
Benefits
Fiat-backed stablecoins offer these substantial benefits to payment leaders:
- Improved customer service
- Reduced payment costs
- Increased total payment volumes
- Reduced operating costs
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