Global Banking Powerhouses Plan Issuing New | Crypto News
A consortium of major banks, including Bank of America, Citi, Deutsche Bank, Goldman Sachs, and UBS, announced on Friday that they may collaborate to explore the development of stablecoins pegged to G7 currencies.
A New Era For Crypto In Mainstream Finance
The renewed curiosity in stablecoins comes in the wake of US President Donald Trump’s endorsement of the sector, which has reignited discussions about integrating blockchain technology into mainstream finance.
Currently, the stablecoin market is closely dominated by Tether (USDT), based in El Salvador, which accounts for roughly $179 billion of the overall $310 billion in stablecoins circulating, according to data from CoinGecko.
The banks concerned in this new initiative, which also contains Santander, Barclays, BNP Paribas, MUFG, TD Bank Group, and others, have acknowledged that the purpose is to assess whether or not a collaborative industry offering might improve competitors and convey the advantages of digital belongings to the market, all while guaranteeing compliance.
Notably, France’s Societe Generale just lately turned the first major bank to issue a dollar-backed stablecoin through its digital asset subsidiary, although it has seen restricted adoption, with only $30.6 million at present in circulation.
In addition to this consortium, a separate group of 9 European banks, including outstanding names like ING and UniCredit, is also in the method of launching a euro-denominated stablecoin.
Meanwhile, Citi has made strides in the stablecoin space by investing in BVNK, a company targeted on stablecoin infrastructure.
Demand For Stablecoin Solutions Grows
Although Citi has not disclosed the quantity of its investment, the co-founder of BVNK, Chris Harmse, told during an interview with CNBC, that the company’s valuation has surpassed $750 million, as reported in its latest funding spherical.
Harmse remarked on the rising demand for stablecoin infrastructure, significantly with the emergence of regulatory readability through the passage of the GENIUS Act in the US. This has prompted major US banks to strategically place themselves in the crypto ecosystem.
Citi’s CEO, Jane Fraser, has indicated that the bank is considering the issuance of its own stablecoin while also exploring custodian providers for digital belongings. However, Citi just isn’t alone in its pursuit of digital asset integration; JPMorgan Chase has already launched its own stablecoin-like token, JPMD.
Banks are more and more investigating how blockchain technology—initially developed to help Bitcoin—can scale back transaction prices and improve processing speeds across varied financial operations.
This exploration contains the idea of tokenization, which includes creating digital tokens that symbolize conventional belongings, such as deposits. For occasion, Bank of New York Mellon is at present trying into tokenized deposits, while HSBC has already rolled out a tokenized deposit service.
Featured image from DALL-E, chart from TradingView.com
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