American money transfer company MoneyGram has made a long-term investment in a minority stake in crypto ATM operator Coinme.
Founded in 2014, and also headquartered in the US, Coinme operates a cryptocurrency exchange platform through nearly 6000 physical locations. Through a partnership with coin exchange machine operator Coinstar, Coinme allows customers to buy bitcoin with cash and withdraw crypto-currency holdings from 20,000 ATMs in four countries.
MoneyGram already teamed up with Coinme in May 2021 on a feature that would allow Bitcoin customers to transact with cryptocurrency using regular ATMs at its locations in 49 US states and international markets.
The service works very similarly to standard ATM transactions, while Coinstar’s technology allows cryptocurrency to be transferred to users’ existing wallets with a simple QR scan. The transaction price will depend on the Bitcoin exchange rate, which the ATM retrieves from the Internet in real time. Also, an additional percentage fee is charged by the ATM for the service and is factored into the rate.
At the time, MoneyGram said supporting Bitcoin at ATMs would be a valuable addition to the entire ecosystem, and also indicated that the service would only require a software upgrade because the method used depends on how the device is configured by the owner.
The move came as financial services giants, including PayPal and Square, are making increasing moves in the crypto space.
FinanceFeeds Webinar: An Expert Panel Discussing Market Data for Multi-Asset Brokerages
MoneyGram suspended with Ripple’s under-fire token
Coinme, which is the second largest operator of bitcoin ATMs in the United States, is subject to federal regulation through the Financial Crimes Enforcement Network, but state guidelines limit where they can actually set up a store.
Alex Holmes, Chairman and CEO of Moneygram commented: “At Moneygram, we remain optimistic about the tremendous opportunities that exist in the ever-growing world of cryptocurrency and our ability to act as a compatible bridge linking digital assets to local currency.”
The CEO of Moneygram added: “As we accelerate our innovation efforts, partnerships with start-ups like Coinme will cement our position as an industry leader in the use of blockchain and similar technologies.” Our unique Cash-to-Bitcoin offering with Coinme, announced in May 2021 Opening our business to a whole new customer segment, we couldn’t be happier with our progress.”
The latest MoneyGram investment came less than nine months after it formally cut ties with Ripple Labs in light of the ongoing legal battle with the US Securities and Exchange Commission. The two companies suspended their relationship, dating back to 2018, after the Securities and Exchange Commission accused Ripple of conducting an illegal $1.3 billion offer of securities.
Along with a partnership to experiment with Ripple’s XRP in cross-border payments, the token issuer bought $30 million in MoneyGram in 2019. The Nasdaq-listed company revealed that it raised more than $60 million in fees from using XRP remittances as an alternative source of revenue each year. Payment and settlement services