The Stellar blockchain is gaining major momentum as IBM partners with six international banks to issue fiat-backed stablecoins on its World Wire payment network. This strategic move signals a pivotal moment for XLM, cross-border payments, and the broader adoption of blockchain in global finance.
Built on the Stellar Consensus Protocol (SCP), IBM’s World Wire aims to revolutionize how money moves across borders—offering faster settlements, reduced costs, and seamless multi-currency transactions. With banks now preparing to issue stablecoins pegged to currencies like the euro and Indonesian rupiah, the ecosystem around Stellar is rapidly expanding.
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A New Era for Cross-Border Payments
Traditional international transfers are notoriously slow and expensive, often taking days and involving multiple intermediaries. IBM’s blockchain-powered solution cuts through this inefficiency by enabling near-instant settlement using digital tokens backed by real-world currencies.
Jesse Lund, IBM’s blockchain lead, emphasized that the infrastructure is ready:
“Everything is in place—we’re just waiting for regulatory approval.”
The initial participating banks include:
- Rizal Commercial Banking Corporation (RCBC) – One of the Philippines’ largest banks, part of the historic Yuchengco Group.
- Banco Bradesco – Brazil’s oldest private bank, with significant government ownership.
- Busan Bank – South Korea’s largest regional bank, managing over $30 billion in assets.
These institutions will act as anchors within the network, issuing and redeeming stablecoins tied to their local currencies. Their involvement underscores growing institutional confidence in blockchain-based financial infrastructure.
Why Stellar? The Technology Behind World Wire
Unlike private, permissioned blockchains, Stellar offers an open, decentralized protocol designed specifically for fast, low-cost value transfers. IBM chose Stellar because of its scalability, energy efficiency, and built-in decentralized exchange capabilities.
“IBM is a network operator; Stellar is the underlying protocol,” Lund explained—highlighting the symbiotic relationship between enterprise adoption and public blockchain innovation.
World Wire currently supports only XLM (Stellar Lumens) as the bridge asset for cross-currency transactions. When a user sends money from one country to another, the system converts the source currency into XLM, then into the destination currency—enabling real-time settlement without traditional correspondent banking.
This dual role—as both a utility token and liquidity layer—positions XLM at the heart of an emerging global payment ecosystem.
Expanding the Stablecoin Ecosystem
While World Wire initially launched with a USD-pegged stablecoin developed by startup Stronghold, the roadmap now includes support for multiple new fiat-backed tokens.
The addition of euro and Indonesian rupiah stablecoins marks just the beginning. Lund revealed plans to onboard more banks and currencies, including potential integration with central bank digital currencies (CBDCs).
“Our vision is to expand the world of bank-supported stablecoins. As more join, the very concept of foreign exchange will evolve.”
This expansion doesn’t just benefit banks and consumers—it significantly increases demand for XLM. Each transaction requires a small amount of XLM as a transaction fee (fractions of a cent), creating consistent token usage across the network.
Moreover, these banks can enhance liquidity for XLM by acting as on-ramps and off-ramps between fiat and digital assets—further solidifying Stellar’s role in mainstream finance.
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Regulatory Progress and Global Reach
One of the biggest hurdles in launching blockchain-based financial services is regulatory compliance. However, IBM reports having received a “favorable verbal response” from U.S. regulators regarding its stablecoin initiatives.
Still, Lund confirmed that operations will initially focus outside the United States, with full domestic rollout targeted for Q3 or Q4 2025.
Even without U.S. launch, World Wire already spans 72 countries, supports 48 currencies, and connects 46 banking endpoints—including banks and remittance providers. This extensive reach makes it one of the most globally integrated blockchain payment platforms today.
IBM vs. JPMorgan: Open vs. Closed Systems
When asked how IBM’s approach compares to JPMorgan’s JPM Coin—a private stablecoin running on a permissioned blockchain—Lund highlighted a key distinction:
“Our solution is open and interoperable. JPM Coin operates in a closed network.”
While JPMorgan’s model serves internal corporate clients, IBM’s strategy embraces collaboration across borders and institutions. By leveraging an open protocol like Stellar, it allows any compliant bank or financial entity to join—fostering inclusivity and scalability.
This open architecture aligns with the original ethos of blockchain: decentralization, transparency, and universal access.
The Rise of XLM: From Underdog to Contender
Launched in 2014 by Jed McCaleb, co-founder of Ripple, Stellar (XLM) was designed to address some of Ripple’s perceived limitations—particularly around decentralization and accessibility.
Over the years, McCaleb’s relentless development efforts have elevated Stellar into a serious competitor in the enterprise blockchain space. With partnerships like IBM’s, XLM is no longer just another cryptocurrency—it’s becoming critical financial infrastructure.
Compared to XRP, Stellar offers:
- Lower transaction fees
- Faster consensus times
- Greater decentralization
- Native support for token issuance and atomic swaps
As more institutions adopt Stellar for real-world use cases, XLM’s utility—and potential valuation—continues to grow.
Frequently Asked Questions (FAQ)
What is IBM World Wire?
IBM World Wire is a blockchain-based global payment network built on the Stellar protocol. It enables instant cross-border transactions using stablecoins and XLM as a bridging asset.
Which banks are involved in the Stellar stablecoin initiative?
Confirmed participants include Rizal Commercial Banking Corporation (Philippines), Banco Bradesco (Brazil), and Busan Bank (South Korea), with three additional banks expected to join.
How does XLM benefit from this partnership?
XLM serves as the intermediary asset in multi-currency transactions on World Wire, increasing its circulation and utility. Every transaction also burns a small amount of XLM, creating deflationary pressure over time.
Are these stablecoins available now?
The technical infrastructure is complete, but launches await regulatory approval in each jurisdiction. IBM expects full deployment in key markets by late 2025.
Can individuals use World Wire?
Currently, access is limited to institutional partners like banks and remittance services. However, consumer-facing applications may emerge as the network expands.
Is XLM better than XRP for payments?
While both aim to improve cross-border transfers, XLM offers greater decentralization, lower costs, and open participation—making it more suitable for inclusive financial systems.
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Final Thoughts
The collaboration between IBM and six international banks marks a turning point for Stellar (XLM). No longer just a speculative asset, XLM is proving its worth as foundational technology in modernizing global finance.
With real-world adoption accelerating, regulatory progress being made, and demand for efficient cross-border solutions rising, XLM is poised for significant growth throughout 2025 and beyond.
As more banks issue stablecoins on Stellar and integrate into World Wire, the network effect will strengthen—making XLM an increasingly vital piece of the decentralized financial puzzle.