In brief
- Transak CEO Sami Start is shaping the company’s products to be more flexible.
- Some users may not know they’re using stablecoins in the future, he said.
- The Tether-backed firm is leaning into a so-called stablecoin sandwich.
Most companies want their brand to be front and center when a consumer uses their product, but as an infrastructure provider that specializes in crypto payments, the opposite is rather true for Transak and its stablecoin ambitions.
Transak co-founder and CEO Sami Start told Decrypt that the company is leaning into modular APIs as a white-labeled offering for established firms that want to augment their existing services with stablecoins.
As a result, the Tether-backed firm, which has raised $40 million in total funding, is betting that the next wave of stablecoin adoption will feel more invisible than how it looks today. Historically, Transak has focused on enabling other applications’ users to purchase crypto with cash.
“People know Transak as a ‘buy crypto’ button inside major wallets and other crypto apps,” he said. “We’re starting to roll out more white-label use cases and stablecoin use cases, where it’s about onboarding and using financial applications, rather than buying crypto to speculate.”
Dollar-pegged tokens got a boost in legitimacy this year from the passage of the GENIUS Act legislation in the U.S., with institutions from Citigroup to Bank of America expressing an interest. Still, as they hit consumer applications, some users won’t be aware that they’re using them, Start said.
For applications like PayPal’s Venmo, that could look like tracking a user’s traditional account balance in tandem with holdings of PYUSD. Currently, the firm’s stablecoin is reflected for users separately from “cash,” on its mobile app’s “crypto” page.
When it comes to white-label use cases for stablecoins, where Transak’s brand isn’t attached to the product, Start highlighted the firm’s endpoints with the traditional financial system. Some companies, he added, are interested in the concept of a so-called stablecoin sandwich.
For example, Transak may handle Know Your Customer (KYC) procedures for an individual purchasing a stablecoin with cash in one region, as well as someone who receives that same token in a different region, who then wants to convert those funds back into cash.
“In some cases, we may just do one side of that,” he said. “But by making our product slightly more flexible, we just open up a much, much larger market.”
Start noted that the process could play out in the background for some users, who aren’t confronted with industry lingo. In some ways, it parallels how the California DMV’s recently sunset blockchain-based service used Avalanche, but didn’t invoke the layer-1 network’s name.
Experts say that stablecoins can provide tech firms with additional revenue, as their backing assets—often U.S. Treasuries and cash—generate low-risk returns. In the third quarter, for example, Coinbase reported $355 million in revenue stemming from Circle’s USDC.
Last month, Western Union became the latest payments giant to express an interest in the tech, with the remittance specialist saying it would debut a stablecoin of its own on Solana next year.
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