A consortium of major banks, including Bank of America, Citi, Deutsche Bank, Goldman Sachs, and UBS, are collaborating to explore the creation of stablecoins pegged to the currencies of G7 nations. This initiative signals a growing interest in integrating blockchain technology into mainstream finance and leveraging the benefits of digital assets.
The project, still in its early phases, will focus on developing assets on public blockchains that are pegged 1:1 to real-world currencies, which are known as stablecoins. The goal is to determine whether a new industry-wide offering can harness the advantages of digital assets while ensuring adherence to regulatory requirements and best practices in risk management. Other banks involved in this collaboration include Santander, Barclays, BNP Paribas, MUFG Bank Ltd, and TD Bank Group.
Stablecoins have gained traction as a more stable alternative to volatile cryptocurrencies like Bitcoin and Ethereum, as they are tied to stable assets like national currencies. This feature makes them attractive to traditional banks seeking to offer the benefits of blockchain technology while maintaining regulatory compliance.
The stablecoin market is currently dominated by Tether, which accounts for $179 billion of the $310 billion worth of stablecoins in circulation, according to CoinGecko. Despite the dominance of existing stablecoins, banks are keen to explore this area, with soaring crypto prices and renewed political support for blockchain technology sparking a revival of interest in using blockchain in the mainstream financial system.
France's Societe Generale was the first major bank to issue a dollar-backed stablecoin through its digital asset subsidiary earlier this year. However, the token has not achieved widespread adoption, with only $30.6 million in circulation. In a separate development, a consortium of nine European banks, including ING and UniCredit, announced plans last month to form a new company to launch a euro-denominated stablecoin. Citigroup Inc. is also joining a group of nine European lenders developing a regulated euro-based stablecoin.
The move by these major banks underscores a broader trend of convergence between traditional financial institutions and blockchain-based systems. As banks experiment with regulated stablecoins, central banks are also exploring the inclusion of digital assets within their reserve portfolios. Deutsche Bank's recent report, "Gold's Reign, Bitcoin's Rise," suggests that global central banks could diversify into Bitcoin and gold by 2030, potentially reducing their dependence on the U.S. dollar.
In the United States, the Bank of North Dakota (BND) and Fiserv have partnered to develop the state's own stablecoin, named the Roughrider. This stablecoin will be available to banks and credit unions across the state in 2026, aiming to increase bank-to-bank transactions, encourage global money movement, and drive merchant adoption. The Roughrider coin will be fully backed by US dollars and will be the first US state stablecoin to launch on Fiserv's digital asset platform.
