Checkout.com to Start Accepting Stablecoin Payments in Crypto Push

Gamma Capitals

Online payments firm, Checkout.com announced that it will begin using stablecoins for payment settlements for its merchants 24/7. It is the last prominent financial services firm that has finally made a move in the crypto space. The announcement came on Tuesday in which the startup said that it was introducing a feature that businesses would be able to use for making and accepting payments in a renowned stablecoin, USD Coin, which is pegged to the US dollar. Checkout.com, which competes with payment giants like Stripe and PayPal said that it had entered into a partnership with crypto security company Fireblocks for this purpose.

Stablecoins are one of the essential elements of the crypto space, as they allow investors to skip banks when trading digital currencies. USDC is recognized as the second-biggest stablecoin in the world, as its market supply circulation is valued at $50 billion. The head of crypto strategy at Checkout.com, Jess Houlgrave said that merchants cannot currently settlement payments on public holidays and weekends with fiat currencies, but the new feature will enable them to do so in stablecoins. She gave an example of people using a crypto exchange to buy Bitcoin.

Users are able to get their bitcoin straight away, but the way cards like MasterCard and Visa, or banks operate means that it takes several days for merchants to receive their funds. Houlgrave stated that this can result in a limited working capital for the merchants. According to Checkout.com, they had first tested the feature with some clients privately and about $300 million had been facilitated in transaction volumes in the last couple of months. Now, the payments firm will introduce this feature globally and the FTX crypto exchange will be one of the first ones to use it.

Checkout.com’s rival, Stripe had also introduced a stablecoin payments feature recently, which enables payments in USDC for Twitter creators. These developments are happening at a time when the crypto market is facing a great deal of turmoil. After experiencing a strong rally last year, the market has come down sharply this year with Bitcoin and Ethereum losing almost 50% of their value. But, as compared to bitcoin, the price of stablecoins does not fluctuate that much. This is because stablecoins are pegged to traditional assets, which is the US dollar in the case of USDC. However, even the unique selling point of stablecoins has been called into question recently after what happened with TerraUSD (UST).

The algorithm stablecoin imploded last month, after it fell below its dollar peg. It has dealt a severe blow to investor confidence where cryptocurrencies are concerned. Nonetheless, it should be noted that TerraUSD did not work the same way as other stable-coins because it used code for maintaining its price. Others like USDC and tether are pegged to the dollar, or other assets. Meanwhile, tether also saw its price dip on several exchanges because of investor concerns about the UST disaster. The phenomenon also has global regulatory authorities worried because it is very risky.