BitGo Announces Stablecoin; Robinhood and Revolut Could Follow
Crypto custodian BitGo unveiled a new stablecoin on September 19, joining several other dollar-pegged tokens currently on the market.
The company said that its stablecoin, called USD Standard, will be available starting in January 2025 under the ticker USDS.
The stablecoin will have 1:1 backing with the U.S. dollar through short-duration T-bills, overnight repos, and cash, which will guarantee high liquidity and low risk.
BitGo will have leading accounting firms perform audits on a monthly basis and will publish real-time proof-of-reserves for transparency.
Notably, USDS will feature a reward model that returns 98% of earnings to participants — specifically institutional exchanges and liquidity providers — based on how much they contribute to the ecosystem.
A separate Coindesk interview clarifies that the rewards will not be available to end users. Other stablecoins that have tried to reward end users have excluded the U.S. market because of securities laws, according to BitGo CEO Mike Belshe.
Robinhood and Revolut Rumors
Other companies, including Robinhood and Revolut, are also rumored to be exploring stablecoins, according to a Sept. 26 report from Bloomberg.
Bloomberg cited unnamed sources familiar with the matter and said that the companies may “opt not to proceed” with the supposed plans.
Official representatives from each company have not confirmed the rumors. Robinhood said it had “no imminent plans to launch this offering,” while Revolut said it plans to expand its line of crypto products but did not confirm a stablecoin.
The two companies’ rumored explorations are reportedly motivated by stricter restrictions for stablecoin issuers operating in Europe. Those rules, known as Markets in Crypto-Assets Regulation (MiCA) regulations, require issuers to have an electronic money license in an EU member state, hold part of the stablecoin’s collateral at an independent bank, and meet other requirements.
Some EU-based crypto platforms may delist Tether’s USDT — currently the dominant stablecoin with a $119 billion market cap — if it fails to comply with the regulations. That could leave room for other stablecoin issuers to compete in the EU market.
Tether’s main competitor, Circle, has already obtained EU approval, which will allow it to offer its dollar-pegged USDC and euro-pegged EURC stablecoins in the region.
Ripple, meanwhile, began to test its USD-pegged RLUSD stablecoin in August. The asset is expected to launch by the end of 2024. Regulatory approval is pending, and whether Ripple plans to launch the product in Europe is unclear.
