By: Luke Tuttle, Chief Product and Technology Officer, MoneyGram
Compiled by: Chopper, Foresight News
Recently, global cross-border personal remittance giant MoneyGram officially launched its stablecoin MGUSD. Luke Tuttle, the company's Chief Product and Technology Officer, published a detailed article sharing the deep considerations behind launching this product from perspectives such as business needs and technical architecture. Below is the full translation of the article:
MoneyGram has been deeply involved in the cross-border remittance field for over eighty years. This history is invaluable because people's core needs have never changed. Many still work and live abroad, needing to provide economic support to friends and family back home. They still require reliable remittance services, access to cash, digital payments, and local currency, and financial services that fit their lifestyle.
What has truly changed today is what users can do when holding a balance in the MoneyGram App.
MoneyGram has long focused on single-transaction services: users sending money, receiving money, or paying bills. These core functions will remain. But when users can hold a stable US dollar balance in the App, MoneyGram can play a more significant role in their financial lives. Account balances can not only be used for cross-border remittances but also support daily spending, receiving funds, currency exchange, and cash withdrawals. In the future, various new financial services will be gradually launched, benefiting many people globally who previously had limited access to convenient financial services.
MGUSD is not merely a stablecoin product; it is a crucial part of MoneyGram's strategic layout. Leveraging MGUSD, tens of millions of users can hold stable US dollar balances and connect to one of the world's leading networks for fund transfers and cash withdrawals.
This is the transformation MGUSD brings. We use Stellar blockchain technology and a self-custody wallet architecture to provide balance management services. MoneyGram has long served a large population that is underbanked or even unbanked. These users have consistently struggled to have a stable channel for storing assets. After collecting cash at a physical location, money received from family and friends could significantly lose value within a day due to sharp fluctuations in the local currency.
Now, they can choose when and how to receive funds. They can hold funds and optimize their value while also being able to track transaction records; they can also use the balance in the MoneyGram App to purchase daily necessities. These functionalities are no different from the core benefits of a traditional bank account. People previously excluded from the formal financial system due to being unbanked can now access reliable, transparent financial services. We not only opened the service gateway for users but also returned control of the funds to them.
Prepaid debit cards are a classic example. They do solve the digital payment problem for the unbanked population, but they typically come with high fees and very limited supported services. We aim to leverage the new generation of financial service models to reduce fees while expanding service boundaries and providing a better experience.
MoneyGram also possesses a practical advantage. We don't need to educate the market from scratch or cultivate user awareness. Relying on our existing cross-border remittance business, the platform sees massive natural traffic daily, with users actively coming to transfer money, receive money, or withdraw cash. MGUSD can extend value on top of these high-frequency scenarios, optimizing the traditional remittance experience while also diversifying services around the remittance scenario.
At the same time, we are also keenly aware that customers have choices. MoneyGram will continue to collaborate with global partners, including agents, financial institutions, e-wallets, banks, mobile payment service providers, retailers, and digital platforms. Enhancing MoneyGram's consumer service level does not mean closing off the market. One of our strengths is that we can both create a better direct service experience and support partners who provide valuable services to consumers in their respective fields.
Serving Global Users
For billions of people globally, being able to hold stable US dollar assets is not something to be taken for granted. In some regions, salaries can lose value due to local currency exchange rate fluctuations before even reaching residents' hands; in some areas, people can access cash but lack convenient digital balance management tools; there are also populations that, while able to use mobile wallets or prepaid cards, still lack a simple solution: one that allows holding US dollar assets, receiving global remittances, exchanging currency as needed, and accessing more financial services from the same account.
Our goal in launching MGUSD is clear: to build a stable US dollar balance service within the MoneyGram product ecosystem and seamlessly connect it with various real-world services users need daily.
This is the practical application of blockchain technology. We are not deliberately forcing blockchain concepts onto users but leveraging this technology to enable the free flow of digital assets around the clock while integrating applications, compliance systems, and settlement processes to comprehensively improve operational efficiency. For ordinary users, the underlying technology should be "invisible," truly blending into daily use.
Many institutions in the market issue stablecoins primarily to connect with global partners and conduct trading businesses. This model has advantages in scenarios like trading, liquidity turnover, and institutional settlements, but MoneyGram has chosen a completely different development path. We already possess a mature user base, real-world application scenarios, compliance systems, distribution networks, and offline cash withdrawal points. The original intention of launching MGUSD is to make this mature ecosystem more complete.
This positioning difference is crucial. The question we ponder is never "how to get the world to accept a new stablecoin," but rather "how to use stablecoin technology to solve real pain points for MoneyGram's existing users." We believe that to realize the value of a stablecoin, we don't need our token to compete for liquidity with industry-leading stablecoins. If we merely issued a new token hoping for global user adoption, the probability of success would be minuscule. Resources like liquidity, developer ecosystems, exchange support, and wallet integration often concentrate towards top-tier assets.
The uniqueness of MGUSD lies in the fact that it is not attempting to seize first-mover advantage but aims to serve a network that already has actual customer demand. Our core goal is to leverage MGUSD to optimize MoneyGram's own infrastructure and create more value for platform users. The core significance of this asset lies in the functionalities it enables: stable value storage, rapid asset transfer, optimized enterprise treasury management, reduced service costs, and launching new products under the globally recognized MoneyGram brand.
Why Self-Custody Wallets Are Important
After careful consideration, we ultimately chose to adopt a self-custody wallet architecture. This decision has profound implications.
For our users, a self-custody wallet does not mean transforming MoneyGram into an open decentralized finance (DeFi) wallet. The core logic is that users have autonomous control over their digital assets, while MoneyGram is responsible for providing a safe and trustworthy usage experience.
This model also involves trade-offs. For crypto-native users seeking the freedom to transfer assets to various protocols or external wallets, a wallet with Know Your Customer (KYC) requirements is not the first choice. We are not concerned about this; there are already plenty of professional wallets serving the DeFi community. Our target audience is the general public: those who need to send money to family and friends overseas, receive funds, securely store assets, exchange currency as needed, and access funds through a network they know and trust.
MGUSD also overcomes the tokenomic challenges associated with holding stablecoins in self-custody wallets. Most stablecoins in the market impose many restrictions on the distribution rules for yield incentives and the conditions for institutions to obtain yields. By self-issuing MGUSD, we can design incentive mechanisms, economic models, and value distribution systems uniformly around the core needs of users and partners.
One of MoneyGram's most important advantages is our hybrid online and offline model, a strength difficult to replicate. We have both digital service channels and operate one of the world's largest offline payment networks. To this day, billions of people's daily financial interactions still rely on cash. Cash withdrawal is by no means an outdated, obsolete model but a prevalent reality. Currently, MoneyGram has built the world's largest two-way on/off-ramp network for crypto assets and cash.
Leveraging this vast network, the value of MGUSD is further amplified. Users' digital balances within the MoneyGram App can serve as an asset storage vehicle; simultaneously, through offline points, digital assets can be flexibly converted into cash, local currency, or directly used for cross-border remittances, bill payments, card spending, and other various financial services.
Compliance is also part of the product. We are not like startup crypto companies that patch compliance processes after product launch; instead, we strictly adhere to compliance bottom lines from the business's inception. MGUSD was designed from the outset to fully adapt to rules such as customer identity verification, sanctions list screening, transaction monitoring, and consumer protection, fully complying with regulatory requirements for global cross-border fund flows.
Building a Robust Settlement Infrastructure
Launching MGUSD is also a crucial step in the comprehensive modernization of MoneyGram's infrastructure. We will fully leverage the value of stablecoins in appropriate scenarios. It should be noted that when connecting with partners and exchanges and conducting trading businesses, we will also use other mainstream stablecoins available in the market. The convenience stablecoins bring to end-users can also optimize MoneyGram's own operational systems.
Currently, we have upgraded the stablecoin treasury management module and fully integrated it into our corporate financial platform. The company's cash management system now uniformly manages traditional cash and stablecoin assets. Whether assets are held in traditional bank accounts or on the blockchain, treasury, finance, settlement, and operations all follow unified workflows, approval mechanisms, risk controls, and data reporting standards.
As of the publication of this article, the annualized volume of our foreign exchange transactions conducted using stablecoins has reached $2 billion. This substantial business volume has driven us to iterate and upgrade our treasury management tools. Stablecoins are no longer an add-on module detached from our main business but an integral part of future daily liquidity management.
This means MoneyGram can use stablecoins, via our existing corporate financial platform, to complete agent fund disbursements, business advance funding, and settlement. Partners and offline agents do not need to adapt to entirely new processes; stablecoin-related functionalities have been seamlessly embedded into MoneyGram's original standardized workflow.
In advance funding and settlement processes, we maintain a stablecoin-neutral strategy, not binding to a single currency, ensuring agents and partners always have ample choice and operational flexibility.
Here, blockchain truly acts as the underlying infrastructure, effectively reducing friction in treasury management processes, enhancing the efficiency of global liquidity flow, accelerating the speed of business advance funding, and allowing us to allocate assets more flexibly across global markets.
Advancing Product Implementation at Startup Speed
MGUSD is not just a technology choice; it is a change in operational mode. If we had continued with the traditional model of multiple handovers and lengthy processes, we might still be in the planning stage today, unable to launch the product.
Over the past year, MoneyGram has comprehensively restructured the organizational architecture of the product and technology departments, implementing flat management and dividing into multiple business domains. Each domain independently manages a complete business module facing users, partners, or the platform, led by a dedicated person with the core goal of implementation and delivery, not merely coordination.
Within each business domain, cross-functional teams are further formed. These teams bring together personnel from various roles such as product, development, design, data analysis, compliance, cybersecurity, and operations, working collaboratively towards clear business objectives. The core purpose of this mechanism is simple: reduce cross-department dependencies, improve communication efficiency, and eliminate any redundant processes and bureaucratic elements that do not enhance business value.
The importance of this new operational model is no less than any blockchain technology decision. In a rapidly changing market, having a sound strategy alone is insufficient. The ability to make quick decisions, implement products, review and iterate, and adjust flexibly is essential to keep pace with market opportunities.
My past professional experience also influenced the thinking behind this organizational change. Throughout my career, I have long been in work environments that emphasized efficiency, clear responsibilities, and direct user feedback. These traits are fundamental for a company's success. I previously worked at Klarna, participating in the launch of its US market operations. This experience gave me a profound understanding that teams with streamlined sizes, clear responsibilities, and members possessing independent decision-making capabilities can unleash tremendous execution power.
At MoneyGram, we combine this operational philosophy with advantages that startups do not possess: decades of institutional experience accumulated in the cross-border remittance field. The company's strength lies in the wealth of knowledge embedded in our teams, compliance department, finance department, agent network, and global operations. We have not replaced this experience; we have enhanced it.
Simultaneously, we have introduced talent from several companies, including Klarna, Kraken, Root Insurance, Remitly, Stripe, Meta, eBay, etc., and have them collaborate side-by-side with MoneyGram's veteran teams.
Our goal is not to superficially imitate the style of startups but to accelerate the pace of a modernized product and technology organization while maintaining the rigor expected of a regulated global financial services company.
In selecting partners, we also uphold the same standards. Partners involved in building MGUSD, the wallet system, balance management, and treasury settlement platforms must not only possess solid technical capabilities but also adapt to the current market pace.
The partners involved in building MGUSD and its supporting wallet system are as follows:
- Stablecoin (a Stripe company): A compliant stablecoin issuer whose product adapts to US regulatory requirements like the GENIUS Act;
- Crossmint: Provides wallet management API interfaces, coordinating the transfer flow of MGUSD within the MoneyGram platform;
- FireblocksHQ: Supports MoneyGram's enterprise-level stablecoin treasury management system;
- m0: Provides smart contract infrastructure, responsible for the minting and burning of MGUSD tokens;
- StellarOrg (Stellar Development Foundation): MGUSD is initially deployed on the Stellar blockchain.
The entire product suite took only about a year to implement. While technology and partners are important, the efficient execution power brought by optimized organizational architecture is no less significant than any technical architecture decision.
Adhering to an Open Partnership Ecosystem
Upgrading the end-user product experience does not mean we will weaken support for partners; on the contrary, it will make us a better partner. More robust underlying infrastructure can incubate new features, optimize existing business processes, and create more choices for both users and partners.
Our offline agents, partner banks, mobile wallet service providers, retail merchants, and various digital platforms serve different user groups. We hope that with better transfer channels, more diverse settlement solutions, and superior user experiences, we can help all partners grow together.
This is the business model we adhere to: MoneyGram can simultaneously create value for both end-users and partners, with the two complementing each other. An upgraded account balance service with an enhanced experience will attract more users to MoneyGram products; and rich partner integration methods can also allow more users to access and use this new service.
Future Outlook
The entire project is still in its early stages. Product forms, regulatory rules, and user demands will continue to evolve, but our development direction remains clear: global users desire stable asset storage tools, better financial services, and comprehensive control over how their funds are stored, transferred, and used.
This is precisely the original intention behind launching MGUSD. We are not issuing a token for the sake of issuing a token. Instead, we are leveraging a mature, widely known, and fully trusted network to build a more complete solution for fund storage, transfer, withdrawal, and usage.
