The news: Klarna will launch its own stablecoin, KlarnaUSD, per a press release.

The Swedish fintech is building KlarnaUSD on Stripe’s Open Issuance powered by Bridge, making it the first neobank to release a token on the platform. Klarna expects the crypto to roll out in 2026.

Why this matters: Joining the crypto fray signals Klarna's growing global ambitions. Based in Europe, Klarna has made significant inroads into the North American market, notching partnerships with retail giants like Walmart and crossing 3.2 million sign-ups for its card. 

With a stablecoin, Klarna could make cross-border payments faster and cheaper. It could also help improve Klarna’s transaction margins and let the BNPL provider offer more robust banking-like services without a US banking partner.

But Klarna needs to incentivize users to convert their fiat to crypto, which could be achieved by offering better financing terms for KlarnaUSD transactions.

Our take: Klarna joins a slew of peers like Block, Google, Fiserv, and SoFi pushing stablecoin as the path forward to consumer payments. 

To execute this future, firms need to educate consumers on the nature of stablecoins versus other digital currencies, which historically have experienced dramatic price volatility. By assuring consumers that stablecoins are backed by fiat, payment providers have a greater chance of convincing shoppers to convert to crypto—especially if they pair that with other perks like rewards or better rates.