Global banks are betting big on stablecoins. A group of 21 international financial firms, including Bank of America (BoA), Citi, and Goldman Sachs, plans to roll out a stablecoin solution by H1 2027.
In a statement on the 1st of September, the group said the product will be 100% backed and available across public chains. It also plans to operate globally, but the initial focus will be on a USD-based stablecoin with broader expansion.
A longer-term ambition of expanding issuance into stablecoins denominated in additional G7 currencies, with a EUR offering as a priority.
The consortium added that,
The product will be utilised in a variety of use cases covering wholesale, institutional and retail markets where client benefits can be achieved by utilising a trusted form of digital money, including cross-border payments and digital asset settlements.
Notably, the firm that will run the stablecoin is set to be announced in H2 2026. Undoubtedly, this is a massive update. But there were two shocking insights from the push.
Are banks now pro-stablecoin and CLARITY Act?
First, the group noted that the “initiative intends to be GENIUS Act and MiCA-compliant, as applicable.” For starters, banks have been a major stumbling block to the U.S. CLARITY Act because of the stablecoin yield issue.
In fact, some even want the GENIUS Act amendment or their demands captured in the delayed CLARITY Act. Mike Dudas, founder of VC firm 6thMan Ventures, was also shocked by the bank’s double standards and noted,
But but but, I was told by the big banks that stablecoins are a threat to the US dollar, consumers and the financial system!
Secondly, the big banks have been focused on tokenized deposits. This is mainly because it benefits and supports their fractional reserve banking model. In other words, they can expand credit and get extra revenue through it. In contrast, traditional stablecoins are 1:1 reserve-backed, and new tokens are created only when fiat is deposited.
To ward off the crypto firms’ growing market share, JPMorgan Chase, BoA, Citigroup, and others announced plans to launch a tokenized deposit network in 2027. This will be run by a co-owned company called Clearing House, according to a Wall Street Journal (WSJ) report.
In fact, even the Bank for International Settlements (BIS) backs tokenized deposits over traditional stablecoins. But most tokenized deposits have been pitched as perfect for wholesale payments between major institutions or banks.
However, the latest announcement says the upcoming stablecoin solution will be used for both retail and wholesale payments. It’s unclear whether this means the banks will shelve their initial tokenized deposit plan or they’ll run parallel.
That said, the U.S. is pushing for harmonized stablecoin rules across the G20 economies to drive ‘clear pathways’ for responsible innovation. Moreover, the sector eased to $300 billion but has begun rising again.
Final Summary
- Big banks plan to unveil a stablecoin in 2027 for retail and wholesale payments
- The move is against the BIS’s push for tokenized deposits over traditional stablecoins