Insurance and financial services provider TruStage has announced plans to launch a fully reserved US dollar stablecoin for the country’s credit union sector.
It hopes the TruStage Stablecoin (TSDA) will broaden access to digital payment infrastructure for community-based financial institutions.
TruStage has been working with credit unions for more than 90 years, and says it currently serves more than 93% of the US sector
Its stablecoin will be among the very first to be specifically created for community-based financial institutions and is supported by “decades of industry relationships, financial strength and operational excellence”, the fintech adds.
“In my career working with credit unions, I’ve never witnessed the level of engagement surrounding any technology advancement similar to what I’m seeing with stablecoin solutions right now,” said Brian Kaas, president and managing director of TruStage Ventures, the venture capital arm of TruStage. “The regulatory clarity of the Genius Act created a buzz among these institutions, who increasingly recognise stablecoins as a powerful payment rail for financial institutions rather than speculative crypto assets.
“We are working toward a collaborative stablecoin model where credit unions can thrive.”
Related: US credit union launches stablecoin as part of digital asset platform
TSDA was developed by TruStage in collaboration with Block Time Financial, a provider of blockchain solutions incorporating regulatory compliance into its technology. The partnership will see TruStage act as the issuer for TSDA, while Block Time Financial will provide blockchain infrastructure and operational support, including security protocols and digital account capabilities.
“We’re thrilled to see stablecoins gaining traction within financial institutions as an emerging payment infrastructure, yet one of the largest untapped segments is credit unions,” said Bruce Rosenheimer, CEO of Block Time Financial. “The strong history and trust TruStage has built with credit unions allows it to create a widely adopted solution for the whole industry. We are excited to be part of this endeavour.”
Expected uses for the stablecoin include:
- Settlements and disbursements among credit unions
- Faster funding for a variety of loan types
- Quickly settling loan participations
- More convenient access and lower fees for peer-to-peer transactions, bill pay and merchant purchases
- Lower-friction cross-border payments, including for military members stationed abroad
TruStage is now recruiting credit unions to join its initial pilot in the first half of this year, with plans to expand eligibility to additional credit unions in the future. No entry fee is planned for participants.
