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Ubyx, a novel stablecoin clearing platform that seeks to accelerate stablecoin adoption by facilitating redemption at face value, has secured a $10 million seed investment round supported by several prominent crypto investors.
This funding round was spearheaded by Galaxy Ventures, with contributions from Coinbase Ventures, Founders Fund, VanEck, Paxos, and others, as per a Tuesday announcement. The startup intends to unveil its platform in the last quarter of 2025.
This service will permit licensed banks and fintechs to redeem stablecoins directly for fiat at par value, with the goal of minimizing friction in stablecoin utilization and promoting wider acceptance.
Ubyx’s partners include stablecoin provider Paxos and blockchain Ripple, which is geared towards financial services, along with other participants within the financial services and crypto infrastructure spheres.
“Stablecoins gain widespread acceptance when there’s an interconnected network, similar to credit cards,” Mike Giampapa, general partner at Galaxy Ventures, commented.
The firm has yet to reply to a request for commentary from Cointelegraph.
Related: Malaysia launches Digital Asset Hub to examine stablecoin, programmable cash
Clearing system addresses market fragmentation
Ubyx asserts that the present stablecoin market confronts challenges to widespread adoption, with existing stablecoin on- and off-chain configurations being a hindrance. Various stablecoin issuers develop their distribution networks, resulting in heightened costs and a deficiency in interoperability.
Currently, institutions are also unable to regard stablecoin assets as cash equivalents on their balance sheets. Ubyx claims its stablecoin clearing system resolves these concerns by linking multiple issuers with several receiving institutions.
Related: JPMorgan files ‘JPMD’ trademark for crypto payment solutions
Integrating traditional finance and stablecoins
Ubyx intends to incorporate stablecoins into conventional finance by “allowing the redemption of stablecoins for fiat at par value directly into existing bank and fintech accounts.” This initiative aims to mitigate market fragmentation and standardize redemption, purportedly to facilitate cash-equivalent accounting treatment.
“Just as the internet revolutionized communication, stablecoins on public networks will transform payment systems,” Shan Aggarwal, vice president of corporate and business development at Coinbase Ventures, expressed.
This announcement arrives amidst increasing transaction volumes in the stablecoin realm, which processed 19.4 times more value than PayPal over the last year, according to Daren Matsuoka, a data scientist at a16z Crypto.
Ubyx founder and CEO Tony McLaughlin stated that the service enables a market structure featuring multiple stablecoin issuers depending on diverse blockchains and currencies to function on a unified network.
Ubyx will initially accommodate various blockchains, including Aptos, Arbitrum, Avalanche, Base, Canton, Concordium, Hedera, Polygon, Solana, Starknet, Stellar, Sui, XDC, XRPL, and ZKsync.
The firm is also commencing with vital infrastructure partners, such as BitGo, Copper, Chainalysis, and Fireblocks.
Magazine: Crypto aimed to disrupt banks, now it’s becoming them in stablecoin battle
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