Buy now, pay later company Klarna Group and payment processor Shift4 Payments are embarking on ventures involving stablecoins as they seek to capitalize on the digital currency trend.
London-based Klarna said it is developing the capacity to raise funding with the digital assets through a partnership with cryptocurrency exchange Coinbase. Separately, Allentown, Pennsylvania-based Shift4 announced Monday the launch of a stablecoin settlement platform available to the company's merchant customers.
Stablecoins are tied to the value of a fiat currency such as the U.S. dollar or the euro, which theoretically makes them more stable in value than more volatile digital cryptocurrencies like Bitcoin.
Klarna, which is licensed as a bank in the European Union, "plans to raise short-term funding from institutional investors denominated in USDC utilizing Coinbase's digitally native infrastructure," the company said in a Friday news release.
The process is still in development, the release said. A Klarna spokesperson declined to provide more information on the timeline.
USDC is a stablecoin pegged to the value of the dollar and is issued by Circle Internet Group.
Meanwhile, digital rival Shift4 said in a Monday news release that its new stablecoin platform will give merchants the ability to settle transactions involving digital assets outside of normal banking hours.
That is one of several practical applications for stablecoins that payments executives have discussed in recent months.
A Shift4 spokesperson did not respond to a message asking when the company's merchant customers will be able to use the platform to send and receive payments using digital currencies.
The passage of the Genius Act, which was signed into law by President Donald Trump in July and creates a regulatory framework for stablecoins, is largely expected to turbocharge the use of the digital assets.
The two firms are hardly alone in taking an interest in stablecoins. Payment processors such as PayPal Holdings and Fiserv have both introduced their own stablecoins and Stripe introduced stablecoin payments for subscriptions in October.
