Later this month, eligible Galaxy device owners in the United States will be able to open Samsung Wallet, buy USDC, and send it to a crypto wallet abroad in seconds. The same app will also let them send money to bank accounts in more than 60 countries for a small fee, where the recipient gets it in local currency.

There's no separate crypto app to install and no private key to hold on to. Samsung builds the app, though its bigger contribution to the ecosystem is the person holding the phone.

Bastion is the licensed stablecoin custodian and infrastructure partner for the stablecoin functionality inside Samsung Wallet. Coinbase is the crypto acquisition pipeline for the 82 million Galaxy devices in the US that can run Samsung Wallet.

Samsung clearly mentioned in the press release announcing this functionality that it's neither a bank nor a money transmitter. It's just making it simple for people to access these features, powered by other service providers, through an app that it builds.

It's effectively leasing them access to the 82 million eligible Galaxy users in the US without taking on the execution risk.

While details of the arrangements Samsung has struck with Bastian and Coinbase aren't available, the model behind it isn't new. For example, Samsung already charges Google billions to keep it as the default search engine.

Now more than ever, Samsung's mobile division needs more sources of revenue. It's losing money on phones and even multiple rounds of price hikes aren't enough. The division has already lost about $500 million in the second quarter of this year.

In such a scenario, where each new Galaxy phone earns little or nothing, the devices already in people's pockets, and what partners will pay to reach their owners, have to do more of the heavy lifting.

Samsung has a history of inking such partnerships where it shifts the execution risk to service providers in exchange for giving them the privilege of accessing its customer base.

For example, Barclays issues the Galaxy Card, SoFi ran the Samsung Money debit card, AI tools like Perplexity and Gemini are baked into One UI, and now, Bastion and Coinbase get to be front and center as the Galaxy embraces stablecoins.

This opportunity goes well beyond stablecoins. The Galaxy devices can serve as a potential gateway to additional payments, financial services, AI, subscriptions, and other third-party services.

Samsung has built an increased hardware base and an enviable distribution network. It can easily put a product or service before hundreds of millions of users where a commercial arrangement makes sense for it to do so.

That's why Samsung's enormous installed base is an asset in its own right. It's getting progressively harder for Samsung to sell more Galaxy phones in the AI memory super cycle age.

The company is already having to cut production numbers by tens of millions of units. Additional service partners can help Samsung better monetize its massive existing customer base.

It goes without saying that there's a limit to how far Samsung can push this strategy. Service providers will only pay Samsung for access if Galaxy users actually adopt. They won't tolerate placements or partnerships that look obviously commercial.

That's why the model it has adopted with Samsung Wallet is so useful. It masterfully blends services provided by others with just enough “Samsung-ness” to strike the perfect balance.

This could be a viable future growth engine for Samsung's mobile division, not just in the United States but across the globe, where it sells hundreds of millions of devices every year.

Samsung doesn't need to become a bank, a crypto exchange, or an AI chatbot. It just needs to build the perfect gateway to all three that helps it collect a share of the value created.