Klarna to roll out dollar-backed stablecoin
The Swedish fintech is entering the cryptocurrency space with the launch of a US dollar-backed stablecoin, as its previously skeptical CEO says crypto is finally at a stage where it is fast, low-cost, secure, and built for scale.
The token, called KlarnaUSD, is currently in testing and will be available on the blockchain network in 2026, and will be fully backed by the US dollar, Klarna has said.
Stablecoin is a type of cryptocurrency that pegs its price to a real-world asset, such as the US dollar to reduce the volatility typically associated with digital currencies.
The buy-now-pay-later fintech said that it aims to position KlarnaUSD for everyday payments and cross-border transactions, pitching it as a faster and cheaper alternative to conventional banking.
The stablecoin will run on Tempo, a payments-focused blockchain developed by Stripe and crypto investment firm Paradigm.
The move follows rivals PayPal and Stripe, which launched their own stablecoins earlier this year.
In the US, where Klarna has its biggest user base, businesses can already hold stablecoin balances, convert between fiat currencies, spend stablecoin balances with a locally issued card, and send stablecoins cross-border to crypto wallets.
Klarna, like other stablecoin firms, is expected to benefit from frameworks such as the GENIUS Act in the US and MiCA in Europe.
"Crypto is finally at a stage where it is fast, low-cost, secure, and built for scale. This is the beginning of Klarna in crypto," CEO Sebastian Siemiatkowski said in a statement.
While dollar-pegged stable coins claim to offer a faster, cheaper alternative to traditional banking for cross border payments - criminals think so too and they have widely exploited to launder funds
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