IBM Backs New US Dollar-Pegged Stablecoin That Runs on Stellar Network

A new project for a U.S. dollar-pegged stablecoin that runs on the Stellar blockchain network has received backing from IBM, Reuters reports July 17.

The token launched today, and is reportedly issued using a 1:1 price ratio with the U.S. dollar.

It is the first ever stable-value crypto project to use the Stellar network, as Fortune notes.

IBM has been using the Stellar network to facilitate cross-border payments since 2017, and is said to have now begun testing the new stablecoin.

"IBM will explore use cases with business networks that we have developed, as a user of the token. We see this as a way of bringing financial settlement into the transactional business network that we have been building."

In her interview with Fortune, IBM's Bridget van Kralingen, senior vice president of global industries, platforms and blockchain, said that the new project represented a "Tremendous opportunity" to streamline the firm's existing cross-border blockchain payments efforts.

Van Kralingen said that until now, IBM has been converting between different fiat currencies using Stellar's native token, Lumens as a bridge between them.

Van Kralingen said that stablecoin projects pegged to national fiat currencies other than the U.S. dollar would also be of value for IBM's blockchain integration.

IBM has also today reportedly partnered with Columbia University to open the Columbia-IBM Center for Blockchain and Transparency, which will offer students IBM internships and joint research opportunities.

Stablecoins have been gaining increasing traction with crypto and blockchain industry figures, with Jeremy Allaire, co-founder & CEO of Circle, envisioning them as an integral component of an emerging "Tokenized global economy" at MoneyConf in Dublin last month.