Important highlights:
- Nonco introduces FX on-chain to the avalanche and automates currency swaps between USD and non-USD-supported Stablecoins.
- Institutional liquidity providers and bank integration aim to reduce conversion costs and improve transaction speeds.
- Vaneck is investing in Nonco to support the development of Stablecoin-based FX infrastructure.
Institutional FX meets the blockchain of the new Stablecoin initiative
Digital asset trading company Nonco has unveiled a new FX on-chain protocol on its avalanche blockchain, demonstrating its efforts to integrate traditional forex (FX) liquidity into a blockchain-based financial infrastructure. This protocol allows for direct conversion between USD-backed stub coins such as USDC and USDT, and non-USD stub coins tied to currencies such as the Euro, Brazilian Rial, and Mexican Peso.
FX on-chain is built on top of Avalanche’s C-chain, a hub for liquidity for distributed applications. The system automates the conversion process between local and USD page stubcoin with a focus on improving the efficiency of global payments, cross-border remittances, and multi-currency reconciliation.
Stubrecoins like USDC and USDT have surpassed their $200 billion market capitalization, but stubcoins pinned in non-USD currencies remain unused due to fragmented liquidity and operational barriers. The new protocol aims to close this gap by leveraging institutional FX providers to provide more competitive spreads and faster settlements compared to automated market makers (AMM) models.
The FX On-Chain Protocol presents several features aimed at aligning blockchain-based transactions with traditional financial standards. It utilizes the Quote-for-quote (RFQ) system to provide engine-grade pricing and offers rates and spreads that closely reflect those in the off-chain FX market. Because transactions are resolved in an atomic chain, they can help minimize counterparty credit risk, especially in complex multicurrency transactions. The protocol also includes direct integration with regulated banks and stable issuers, encouraging a smoother transition between traditional and digital finance environments. Additionally, Avalanche’s infrastructure supports extended trading times, enabling rapid payments, and contributes to a more seamless trading experience.
“FX on-chain represents the gradual changes that bring institutional FX liquidity to the blockchain-based market. Combined with Nonco’s institutional trading expertise and the high-performance infrastructure of the avalanche, it serves as a key step in expanding Stablecoin-based FX marketing and capabilities.
– Morgan Krupetsky, Head of Institutions and Capital Markets at AVA Labs
Vaneck backs Stablecoin FX ventures
Asset management company Vaneck is working to invest in NonCo, reflecting growing institutional interest in blockchain-based FX tools. Vaneck CEO Jan Van Eck said the company believes Nonco’s focus is on integrating Stablecoin infrastructure with agency-grade FX capabilities.
Nonco has also attracted previous investments from companies such as Valor Capital, Hack VC and Morgan Creek Digital.
According to Nonco CEO Fernando Martinez, Avalanche was chosen for its speed, low fees and compatibility with Ethereum-based tools. “FX on-chain solves the important inefficiencies of the Stablecoin market. Lack of FX liquidity in facilities. Avalanche provides the infrastructure that needs to be run on scale.”
Conclusion
With the FX on-chain protocol, NonCo is considering making stubcoin in real-world financial use cases more functional by bringing traditional FX mechanics to the blockchain. Supported by major players like Vaneck and operating Avalanche’s fast, scalable infrastructure, the platform is positioned as the new standard for digital FX. The protocol initially supports USDMXN pairs and plans to expand to EURUSD, USDBRL and more.
