Coinbase Launches Stablecoin-as-a-Service

Coinbase launched a program that helps businesses create their own stablecoins, and, in a separate project, will help Klarna implement stablecoin funding.

The company’s new Coinbase Custom Stablecoins service allows businesses to create custom stablecoins backed by flexible collateral, including USDC and other U.S. dollar-backed stablecoins, custodied by Coinbase, according to a Thursday (Dec. 18) blog post.

The Custom Stablecoins platform offers companies issuance infrastructure, with Coinbase handling the smart contract, security and chain management; a customizable brand identity that includes the asset name, ticker and visual identity; and mass global distribution to Coinbase’s user base, the post said.

In addition, Coinbase holds reserves in segregated wallets that it custodies, allows companies to earn rewards on their stablecoin’s supply, and ensures instant liquidity through zero-fee swaps between USDC and any Coinbase Custom Stablecoin, per the post.

“For too long, enterprises have had to ‘rent’ stablecoins for use, relying on third-party issuers and platforms to access stablecoin liquidity with limited control over the product experience,” Coinbase said in the post, adding that its new “stablecoin-as-a-service” solution changes that.

In another, separate project, Coinbase will power stablecoin funding for Klarna, enabling the global digital bank and flexible payments provider to raise short-term funding from institutional investors denominated in USDC via Coinbase’s infrastructure, according to a Friday (Dec. 19) press release.

Klarna said in the release that it chose to collaborate with Coinbase on this initiative because of the company’s proven track record in powering crypto infrastruc ture for more than 260 businesses.

“This is an exciting first step into a new way to raise funding,” Niclas Neglén, chief financial officer at Klarna, said in the release. “Stablecoin connects us to an entirely new class of institutional investors, and gives us the potential to diversify our funding sources in ways that simply weren’t possible a few years ago.”

PYMNTS reported in October that Coinbase is building an “Everything Exchange” that includes trading, financial services and applications. Part of the company’s plan for growth is providing infrastructure and developer tools for on-chain applications that can expand overall network demand, Coinbase executives said during an October earnings call.