Banks Swap Stablecoins with Ease, Thanks to New Conversion Services

Stablecoin conversion services allow institutions to swap one dollar-pegged token for another, or move the same token across blockchains while maintaining a value of 1:1 with dollars.

These services provide a packaged solution that includes custody, issuer connections, compliance, and payment rails to execute mint, burn, and redemption steps on behalf of clients.

The conversion process can be done through two broad paths: on-chain, where the token is burned on one chain and newly minted on another, or off-chain, where a custodian adjusts client balances and coordinates mint/redemption with issuers and bank rails behind the scenes.

For example, Circle's Cross-Chain Transfer Protocol moves USDC by burning it on the source chain, issuing an attestation, and minting the same amount on the destination chain, preserving 1:1 supply across networks.