Major U.S. Banks Explore Launching Joint Stablecoin to Counter Crypto’s Rise

according to a report by the Wall Street Journal, major U.S. banks, including JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo, are in early discussions about issuing a joint stablecoin to stay competitive against the rising influence of the cryptocurrency market. WSJ+1Reuters+1

These preliminary talks involve companies co-owned by these banks and remain at a conceptual stage, subject to change. The consortium could possibly allow other banks, beyond the co-owners of the Clearing House and Early Warning Services, to use the stablecoin as well. Reuters

Stablecoins are cryptocurrencies designed to maintain a steady value, typically tied to a fiat currency like the U.S. dollar, and are widely used by traders to transfer funds between tokens. Additionally, some regional and community banks are considering whether to form a separate stablecoin consortium. Reuters+1WSJ+1

The report coincides with political backing, as Donald Trump has stated support for cryptocurrency, aiming to promote its mainstream adoption and enhance the U.S. banking system and global dollar dominance. Reuters+1CoinDesk+1

A new U.S. legislative proposal, the Guiding and Establishing National Innovation for U.S. Stablecoins Act (Genius Act), is advancing through the Senate and could significantly reshape the $248 billion stablecoin market. MarketWatch+1Business Insider+1

This bill introduces a robust regulatory framework for stablecoins, providing clear compliance guidelines for issuers, consumer protection measures, and designated oversight authorities. By reducing regulatory uncertainty, it is expected to encourage broader issuance of stablecoins by traditional institutions, such as Bank of America and Fidelity, and accelerate tokenization in financial markets. MarketWatch

Industry analysts believe this could lead to increased market participation, enhance the adoption of blockchain-based assets, and position stablecoins as critical infrastructure within decentralized finance ecosystems. Additionally, the act may reinforce global demand for dollar-denominated stablecoins, potentially bolstering the global standing of the U.S. dollar. MarketWatch

Currently, U.S.-based stablecoins like USDT and USDC dominate the market, accounting for 85% of total capitalization. If enacted, the Genius Act is expected to drive massive growth, with analysts predicting the stablecoin market could reach up to $2.5 trillion by 2030. MarketWatch+1Business Insider+1

The bill still faces legislative reconciliation between the Senate and House before it can be signed into law by President Trump. MarketWatch+1Business Insider+1

Bank of America, which has historically taken a backseat in the crypto industry, is prepared to launch its own dollar-backed stablecoin if U.S. lawmakers approve legislation allowing it to do so, its CEO said Tuesday. CoinDesk

Compared to firms like J.P. Morgan and Citigroup, Bank of America has been cautious in its crypto involvement. But shifting regulations may force its hand. The Trump Administration has made it clear that it will support any efforts in the crypto space in part by providing clearer regulatory guidelines, likely increasing competition among Wall Street banks in the sector. CoinDesk

The stablecoin economy has received support from both Democrats and Republicans, making the establishment of laws for these types of digital assets simpler than for other areas in crypto. To move things along, a group of lawmakers earlier this month promised that Congress would pass legislation on stablecoins within the first 100 days of Trump being in office. CoinDesk

While Democrats have expressed concerns about the use of stablecoins for illicit activities, Republicans have full control of Congress, making it likely that it will pass a friendly approach to the digital asset, though any final bill will likely need some sort of bipartisan support. CoinDesk

The sector is already a major force in payments. Stablecoins facilitated over $33 trillion in transaction volume over the past year, outpacing Visa and Mastercard combined, according to data from Visa. MarketWatch+5CoinDesk+5PYMNTS.com+5

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Helene BraunCoinDesk

Helene is a New York-based markets reporter at CoinDesk, covering the latest news from Wall Street, the rise of the spot bitcoin exchange-traded funds and updates on crypto markets. She has appeared on CBS News, YahooFinance and Nasdaq TradeTalks. She holds BTC and ETH. CoinDesk

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Bank of America CEO Brian Moynihan (John Lamparski/Getty Images)CoinDesk+1American Banker+1

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Bank of America CEO Brian Moynihan said the bank will issue a stablecoin if Congress legalizes it. CoinDesk+1American Banker+1

The Trump administration has signaled support for crypto, increasing competition among Wall Street banks. CoinDesk

Stablecoins processed over $33 trillion in transactions in the past year, surpassing Visa and Mastercard. CoinDesk

Bank of AmericaStablecoinsMarketWatch

Helene BraunCoinDesk

Helene is a New York-based markets reporter at CoinDesk, covering the latest news from Wall Street, the rise of the spot bitcoin exchange-traded funds and updates on crypto markets. She has appeared on CBS News, YahooFinance and Nasdaq TradeTalks. She holds BTC and ETH.