The lucrative potential of the $170 billion stablecoin market is motivating Robinhood and Revolut to contemplate the launch of stablecoins in order to broaden their crypto offerings.
Revolut Ltd. and Robinhood Markets Inc. are purportedly contemplating the introduction of their own stablecoins. This development occurs in the context of both companies’ efforts to broaden their crypto offerings and capitalize on the stablecoin market, which is presently valued at approximately $170 billion.
Robinhood, a prominent trading platform situated in the United States, has been investigating the feasibility of launching its own stablecoin. The company has “no imminent intentions to launch this offering,” according to a spokesperson for Robinhood, despite the interest.
This cautious approach is indicative of the company’s strategy to conduct a comprehensive assessment of the potential advantages and hazards of entering the stablecoin market.
Another fintech company, Revolut, is also considering the stablecoin market. In contrast to Robinhood, Revolut has been more forthright about its objectives.
An executive from Revolut stated that the company intends to “further expand” its crypto product portfolio, suggesting a strong interest in stablecoins. Nevertheless, Revolut has not yet made any definitive commitments, similar to Robinhood.
This interest in stablecoins by Robinhood and Revolut is the result of a variety of factors. Stablecoins may be subject to stricter regulations under the forthcoming Markets in Crypto-Assets (MiCA) regulation of the European Union, which could potentially undermine Tether’s market dominance in the EU.
New entrants such as Robinhood and Revolut have a lucrative opportunity to capture market share as a result of this regulatory shift. The financial incentives for the introduction of stablecoins are substantial.
In the first half of 2024, Tether, the current market leader, generated a profit of $5.2 billion, primarily from the reserves that underpin its stablecoin. The stablecoin market has become an appealing proposition for fintech firms seeking to diversify their revenue streams as a result of its profitability.
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