Fiserv Inc. is launching its own stablecoin and joining with both traditional and crypto payments firms PayPal Holdings Inc. and Circle Internet Group Inc. to develop products for financial institutions and merchants within the banking technology provider’s ecosystem.

Fiserv aims to have its FIUSD stablecoin available for customers by the end of the year, the firm said in a statement Monday. Financial terms of the other agreements weren’t disclosed. Shares of Milwaukee-based Fiserv jumped more than 6% before the start of regular trading in New York.

The cryptocurrencies, which are usually pegged to the value of assets such as the dollar, are being touted as a potentially cheaper and more efficient way to move money over payment networks. They’ve gained traction in traditional financial circles with lawmakers poised to pass the first US regulatory guidelines for stablecoins, which were originally used mostly to facilitate trading in the crypto market.

Fiserv counts roughly 10,000 financial institutions and six million merchant locations among its clients. Its existing client base will provide instant scale and allow all participants to build new products and services, the company stated. FIUSD is designed to be interoperable with other stablecoins, so could add new partners, in addition to PayPal’s PYUSD token.

FIUSD will use stablecoin infrastructure from Paxos Inc. and Circle. The new token will be available to Fiserv clients over the Solana blockchain. Fiserv also revealed a new digital asset platform that will leverage Fiserv’s Finxact core processing product and be connected to the company’s orchestration, payments, and banking platforms.

In partnership with PayPal, Fiserv will explore how to integrate FIUSD and PYUSD into cross-border transactions, payouts and merchant solutions. PYUSD was launched in 2023 and is used to fund cross-border transfers via PayPal’s remittance platform, Xoom, and reconcile vendor invoices.

“Our expanded relationship with PayPal furthers our mission to scale stablecoin-powered payments—leveraging our position at the intersection of banking and commerce to build more efficiency and optionality into the payments ecosystem,” Takis Georgakopoulos, chief operating officer at Fiserv, said in the statement.

Fiserv is also considering how to support deposit tokens to provide bank clients with the benefits of stablecoin without sacrificing established regulations regarding bank deposits or losing the capital advantages of deposits for banks.

–By Emily Mason (Bloomberg)