SAN FRANCISCO– The Interledger Foundation has announced an expansion of its open-source Interledger Protocol (ILP), offering a new solution for organisations and governments launching their own stablecoins to connect with each other more efficiently.
The announcement was made on Wednesday in San Francisco as global interest in stablecoins continues to grow, with governments, fintech companies, and banks developing their own digital currencies. Despite this rise, financial experts have raised concerns about the absence of infrastructure to enable smooth transactions between different stablecoins.
The ILP operates in a similar way to internet protocols, allowing the free movement of digital money across networks regardless of the issuing institution or blockchain used. The foundation says this approach could transform how digital currencies are exchanged, making them more accessible and less restricted by technical barriers.
With regulatory frameworks for stablecoins currently under discussion in the US Congress, companies like Fiserv, Mastercard, and Amazon have already announced plans to release their own digital currencies. However, most of these rely on individual agreements with other stablecoin providers, creating a fragmented system with limited cross-border use.
The Interledger Protocol offers a unified standard, allowing stablecoins to interact without exclusive deals, enabling payment across borders and improving access to global markets. The protocol also bridges the gap between stablecoins and traditional fiat currencies, aiming to make digital currencies more practical for everyday use.
ILP has already been adopted in over 40 countries, connecting people, businesses, and governments with faster and more affordable digital payment solutions. Interledger Foundation CTO Alex Lakatos said the protocol will prevent the mistakes made by legacy payment systems and allow stablecoins to operate on a global, open network from the outset.
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