As the race to compete in cross-border payments increasingly shifts toward stablecoins, Klarna has announced its own version, the KlarnaUSD. Despite Klarna’s CEO previously saying the company would be the last major fintech to enter crypto, it appears Klarna felt it had little choice if it wanted to keep pace with competitors in the cross-border arena.
Best known for its buy now, pay later offerings, Klarna will issue the new token on a blockchain developed by Stripe. For now, KlarnaUSD will be used solely for the company’s settlement flows. The stablecoin is expected to be available for both merchant and consumer payments sometime next year.
Klarna said the move to a stablecoin will allow it to send money more cheaply by avoiding intermediaries like Swift. Cross-border transactions currently incur more than $120 billion in fees annually.
The partnership builds on an already extensive relationship between Klarna and Stripe, which provides payment infrastructure for Klarna in 26 global markets. Klarna will become the first bank to use Stripe’s stablecoin stack to power blockchain-based payments. The company also said it expects to bring on additional crypto partners in the coming weeks.
An About-Face on Crypto
Klarna had long resisted entering the world of cryptocurrency, but its CEO Sebastian Siemiatkowski relented in July when the company announced it would let customers pay with Bitcoin and other cryptocurrencies.
“Ok. I give up. Klarna and me will embrace crypto! More to come,” Siemiatkowski posted on X at the time. “Someone had to be last. And that’s a milestone as well of some sort.”
Siematkowski returned to X this week following the announcement of the Klarna stablecoin, posting: “We were wrong on crypto and on bitcoin, must rethink!”
Keeping Up with the Major Players
Earlier resistance in the payments sector has become untenable as even legacy providers have moved into stablecoins. PayPal issued its stablecoin last year, stating that it intended to use the asset to accelerate cross-border transactions. In October, the venerable Western Union rolled out a stablecoin on the Solana network in connection with Anchorage Digital.
More significantly, Visa launched a pilot program last month that allows businesses to prefund Visa Direct transactions in stablecoins rather than fiat currency. This marked the first adoption of a stablecoin by a major payment rail that already handles the lion’s share of international transactions—potentially signaling a point of no return for the industry.
