Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
TD, Scotiabank Among 21 in USD Stablecoin Venture
September 1, 2026 | NCFA Insight | Digital Assets Blockchain And Tokenization, Payments Infrastructure And Money Movement, Cross Border Payments And FX
TD, Scotiabank and Canada’s Emerging CAD Stablecoin Market
On September 1, 2026, TD Bank Group and Scotiabank joined a 21 institution stablecoin venture that plans to form a new company in the second half of 2026. The venture is targeting a USD denominated stablecoin launch in the first half of 2027, followed by a euro product, with other G7 currencies possible later.
The group started with 10 banks exploring a shared stablecoin in October 2025. It now includes Bank of America, Citi, Goldman Sachs, Wells Fargo, Santander, Deutsche Bank, UBS and MUFG alongside TD and Scotiabank. Fidelity Investments and WisdomTree put asset managers inside the venture as well, creating potential connections to investment products, tokenized assets and institutional distribution.
The stablecoin isn't live and the group hasn't disclosed the company name or any details. It says the product is intended for wholesale, institutional and retail markets, including cross border payments and digital asset settlement, and is being designed to meet applicable U.S. GENIUS Act and European MiCA requirements.
The banks are entering a US$320 billion stablecoin market as of the end of May 2026. Roughly 98% of stablecoin value is denominated in U.S. If regulated digital dollars become easier for businesses and consumers to hold and use, banks have an economic reason to compete for the deposits, reserves, customer relationships and settlement activity around them.
Why Banks Are Building Stablecoins
Bank of America CEO Brian Moynihan put a number on one concern in January. Citing U.S. Treasury studies, he said as much as US$6 trillion, or roughly 30% to 35% of U.S. commercial bank deposits, could migrate into stablecoins under scenarios where stablecoin holders can earn interest. It wasn't a forecast that US$6 trillion will leave banks. It illustrated how digital dollars could compete with deposits if customers can earn more elsewhere.
Deposits help fund lending and other bank balance sheet activity. Stablecoin reserves are generally held in cash, short term government securities and other permitted liquid assets. A large transfer from deposits into independently issued stablecoins could leave banks replacing some lower cost deposits with more expensive funding. Issuing or participating in stablecoins gives banks a way to retain more of the economics if customers start holding money onchain.
Europe is pursuing the same opportunity in euros. Qivalis euro stablecoin expanded to 37 financial institutions across 15 countries in May. Bank backed stablecoin ventures are becoming a competitive model alongside independently issued products such as USDC and USDT.
Banks are developing tokenized deposits at the same time. A tokenized deposit remains a liability of the issuing bank. A reserve backed stablecoin is a separate digital claim supported by designated reserve assets. Those differences affect funding, credit creation, redemption and who controls the customer relationship.
TD is already working across both models.
TD Is Active in USD, QCAD and Tokenized Deposits
On August 31, TD completed a Project Agorá payments test using tokenized commercial bank deposits and central bank reserves. TD moved real U.S. dollar funds between two U.S. entities through the Project Agorá platform, with BNY acting as the clearing bank and intermediary.
The test involved 28 central banks and financial institutions, covered 17 transaction scenarios and transferred approximately CHF 800,000 across selected currencies. Project Agorá is examining whether tokenized forms of existing bank money can improve wholesale cross border settlement while keeping commercial bank deposits and central bank money at the centre of the system.
TD also has a direct role in Canadian dollar stablecoins. Stablecorp selected TD in July as primary custodian for the fiat reserves backing QCAD Digital Trust, with the relationship expected to roll out in phases through the third and fourth quarters of 2026.
QCAD is building institutional access from several directions. QCAD bank integration is being developed by Deloitte and Stablecorp for Canadian financial institutions, while VersaBank and QCAD established another Canadian banking relationship earlier this year.
Stablecorp also issued QCAD on Circle's Arc testnet and integrated it with StableFX in May. The QCAD/USDC pair is available in the StableFX sandbox, demonstrating a potential onchain CAD/USD settlement route. Production is expected after Arc's mainnet launch, so this remains development work rather than a live production FX corridor.
Canada now has another domestic model through the CADD stablecoin. Tetra Trust Company, through CAD Digital, launched the 1:1 Canadian dollar backed payment stablecoin in May as Canada's first CAD stablecoin issued by a regulated financial institution.
See: Are Stablecoins Becoming Payment Infrastructure?
TD's activity across QCAD custody, tokenized deposits and the new global USD venture explains why banks may want several forms of digital money. Tokenized deposits can serve customers who want bank money on programmable settlement systems. A CAD stablecoin can support Canadian dollar transactions. A USD stablecoin can connect users to international liquidity, digital asset markets and cross border settlement.
The BankChain Alliance offers another approach. Thirty nine U.S. state banking associations are developing shared blockchain capabilities that could support tokenized deposits, stablecoins and automated settlement while giving participating banks a role in ownership and governance.
Banks are now experimenting with shared stablecoins, individual stablecoins, tokenized deposits and common settlement networks at the same time. The commercial winners will depend on where customers hold balances, which products can reach multiple networks and how cheaply money can cross between them.
Where CAD Stablecoins Fit in a USD Dominated Market
The U.S. dollar begins with an enormous network advantage. The BIS estimates that about 98% of stablecoin value is already dollar denominated. Annual stablecoin transaction volume reached an estimated US$28 trillion in 2025, although the BIS cautions that the number falls substantially after transfers between wallets controlled by the same party are removed and that ordinary payment use remains modest beside established payment systems.
Other currencies have struggled to build comparable liquidity. Only about 0.2% of global stablecoin circulation is euro denominated, even as European banks invest in Qivalis. CAD begins from a still smaller international base.
Canadian businesses still collect domestic revenue, pay employees, manage treasury balances and settle obligations in Canadian dollars. Sending those transactions through USD stablecoins would introduce foreign exchange exposure and conversion costs where a Canadian dollar product could settle directly in CAD.
See: Programmable Stablecoin Payments
Canada has also established a federal regulatory base for the market. Canada's stablecoin regulations now include the Stablecoin Act, Bank of Canada oversight, issuer registration, reserve requirements and redemption obligations, although the Act's substantive requirements are not yet in force.
The Bank of Canada's 2026 Financial System Survey raises a more practical concern. If Canadian businesses rely too heavily on foreign payment systems and foreign controlled stablecoins, more of Canada's payment activity could end up running through systems controlled elsewhere.
TD and Scotiabank can still benefit from joining a global USD stablecoin network. It gives them access to international liquidity, customers and settlement systems. The problem arrives if digital dollars become easy to use while Canadian dollar products remain harder to use for everyday business payments, treasury and settlement.
That risk creates room for Canadian fintechs. Businesses will need ways to convert between CAD and USD, manage liquidity, hold digital assets safely, handle compliance and connect stablecoins to treasury and payment systems without adding unnecessary FX costs.
Talking Point
TD is already working on both sides. It is supporting QCAD reserves, testing tokenized bank money and joining a global USD stablecoin venture. Scotiabank is now part of that international venture too. Canada does not need to match the dollar's global scale, but it does need CAD based digital money that businesses can actually use. Can Canada connect to global digital dollars without making digital CAD an afterthought?
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