Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Citi and BofA Plan Stablecoins as Regulation Advances
Stablecoins | July 18, 2025
Image: Freepik/gstudioimagen
Citigroup and Bank of America Enter Stablecoin Race as TradFi Accelerates Towards Digital Dollars
The dominoes are definitely starting to fall. Citigroup and Bank of America have confirmed they are developing or preparing to launch their own stablecoins. In back-to-back Q2 earnings calls this week, executives from both banks outlined their intentions to support stablecoin issuance for use cases like digital payments and tokenized deposits.
As reported by Reuters, Citigroup CEO Jane Fraser said on July 15 that the bank is “looking at the issuance of a Citi stablecoin” and that stablecoins would fit within the bank’s current initiatives in tokenized deposits, custody, and digital cash on/off-ramp services.
See: Ripple Seeks US Bank Charter for Stablecoin Expansion
Then just a day later, Bank of America CEO Brian Moynihan confirmed that Bank of America is actively preparing to issue a stablecoin of its own. He told analysts the bank “expects to launch” a stablecoin and is in conversations with regulators about what a compliant U.S. dollar-backed version would require. Moynihan also pointed to the advancement of the GENIUS Act in Congress as a key milestone for legal clarity.
JPMorgan Already Live in the Market
Note, JPMorgan Chase already has functional stablecoin infrastructure. JPM Coin, a wholesale payments vehicle used by institutional clients, currently moves over $1 billion in transactions daily. The bank is now expanding into tokenized deposit products for digital settlement use.
Tokenized deposits are regular bank deposits that have been turned into digital tokens. They still belong to the customer and are backed by the bank, but because they run on blockchain technology, they can move money faster and incorporate programmable rules.
See: BIS Stablecoin Warning Meets US Policy Momentum
Worth noting that while Morgan Stanley has not announced its own stablecoin it confirmed during its latest earnings call that it is “actively discussing” potential use cases. CFO Sharon Yeshaya said the firm is monitoring the regulatory landscape and evaluating client needs.
Consortium Stablecoin Being Explored
In a Reuters article May 23, 2025, mentioned that JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and other large commercial banks (including U.S. Bank via consortium channels) are “exploring whether to team up to issue a joint stablecoin,”, but there have been no commitments or formal statements issued yet.
Implications for Traditional Finance
Traditional banks are positioning themselves to be regulated providers of digital dollars that can be used in fast, transparent, and low-cost transactions across modern financial systems.
Stablecoins issued by large banks could compete or potentially replace legacy payment systems for cross-border transfers, securities settlement, reserve management, and cash liquidity optimization. Eventually they may support consumer payments, although bank executives have stressed that the focus is on B2B use cases first.
Bank of England Governor Andrew Bailey recently warned that privately issued stablecoins could destabilize global financial systems if left unregulated, reinforcing the urgency for banks to operate within robust legal and supervisory frameworks.
See: Amazon and Walmart Exploring Merchant-Led Stablecoins
Traditional finance (TradFi) is gearing up to compete directly with crypto native infrastructure in the issuance and management of digital cash.
Outlook
The rapid entry of big banks like Citi and Bank of America into stablecoins confirm what fintech leaders have predicted for years. Programmable money will enter the banking mainstream, depending on regulatory approval and market demand.
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