Coinbase follows its trust charter by boosting stablecoin distribution

• Key insights: Coinbase has partnered with Nium to support conversion from stablecoins to traditional currency to boost payments. 
• What's at stake: Stablecoins are gaining a lot of attention, but are largely not used for payments. 
• Forward look: Coinbase is looking to diversify beyond crypto trading. 

Fresh off of its progress with U.S. regulators, Coinbase is looking to add heft to its ability to support stablecoin payments, a strategy that needs a way to convert digital assets to traditional money to complete transactions.

"Scale in this market comes from meeting enterprises where they already operate," Alec Lovett, head of infrastructure products at Coinbase, told American Banker. 

Coinbase has partnered on a stablecoin project with payments-technology firm Nium, with Coinbase providing the payments, liquidity infrastructure, digital wallet and custodial services and Nium providing payment processing. Coinbase announced the collaboration shortly after receiving a conditional approval for a trust charter from the Office of Comptroller of the Currency, a nod that enables Coinbase to sell cryptocurrency custody as a regulated product.

Coinbase also has an existing license to sell custodial services in New York state, and provides this service for crypto ETF providers and other cryptocurrencies.

The OCC charter also helps Coinbase compete with digital-asset firms that have received limited banking licenses, such as Circle, Ripple and Paxos, which were all approved last December. Other crypto firms that have received approval include Stripe-owned Bridge and Crypto.com.

USDC will be the initial stablecoin for the Coinbase/Nium partnership, though Coinbase said it also supports other stablecoins for payments.

Since stablecoins, which can process quickly and reduce currency conversion risk, are mostly used for trading crypto, these firms are looking to promote other uses for them.

"Despite the flurry of activity and announcements, stablecoins remain fairly nascent," Aaron Press, research director of worldwide payment strategies at IDC, told American Banker. "Building out the network, especially in terms of endpoints where stablecoins can actually be used for routine transactions, will be critical if there is to be any hope of scale outside of bulk money movement."

A boost for stablecoin payments

The Coinbase/Nium collaboration will enable banks and businesses to send, receive, convert and spend USDC, the market's second largest stablecoin, to traditional currency for payouts. Coinbase did not comment on the collaboration covering other stablecoins. 

"Nium's business has focused on enabling access to fiat rails, but now Nium customers can fund cross-border payouts in USDC and settle in local fiat … that's a real, immediate upgrade from a system that forces businesses to lock up working capital for days at a time," Lovett said. The benefit for Nium is shortening settlement time and adding speed to overall processing. That shortens the currency valuation risk by leaving payments "in flight" for a shorter period of time by avoiding correspondent banks, which may have limited processing windows.

"[Coinbase's] rails are open all the time so you can provide local fiat liquidity," Santhosh Srinivasan, group treasurer at Nium, told American Banker. "So businesses can sell to more customers at higher volume. It also reduces the prefunding risk."

Srinivasan said Nium can additionally support cross-border payments during a volatile time for the global economy, with tariffs and the Iran war stressing supply chains and driving inflation.

"Even in normal conditions you have foreign-exchange risk," Srinivasan said. "This enables you to send funds 'just in time.''' 

Coinbase's diversification

For Coinbase, the Nium deal and OCC charter are part of a multi-year strategy to diversify its financial and cryptocurrency services beyond trading. In January, Coinbase launched a prediction market, enabling users to bet on sports and elections, a move that led to controversy when New York Attorney General Letitia James sued the company contending the service runs afoul of the state's gambling laws. Circle has attempted to move that case to federal court, saying its product is under federal regulations.

More recently, Coinbase launched a crypto-lending product in the U.K. in partnership with the Morpho network enabling users to borrow USDC with bitcoin or ether as collateral. In a social media post in April email marking the fifth anniversary of Coinbase's public listing, Shan Aggarawal, Coinbase's chief business officer, said Coinbase's revenue from trading has declined from more than 90% at the time of its listing to about 55% at the end of 2025. 

"This shift has been the result of a deliberate, multi-year, and focused strategy. We diversified our revenue. We built ahead of the market by investing early across areas like custody, staking, and stablecoins before they were mainstream," Aggarawal said in his email. 

At the end of 2025, Coinbase had 12 products generating more than $100 million each in revenue on an annualized basis, spanning custody, staking, stablecoins, derivatives, and other services. 

"The Nium deal is a step in the right direction, but there will have to be several more such deals on both the origination and acceptance sides of the equation before we are likely to see mainstream usage," Aaron Press, research director of worldwide payment strategies at IDC, told American Banker.