Banking Giants Exploring Inter-Bank Stablecoin
By Mark Hunter
2 hours agoMon May 26 2025 09:54:35
Reading Time: 2 minutes
- Major U.S. banks have initiated talks to develop a shared stablecoin for interbank settlements
- The proposed token would be backed 1:1 with U.S. dollars and built on permissioned blockchain infrastructure
- JPMorgan’s JPM Coin is not part of the effort but serves as an example of bank-issued digital assets in use today
Several of America’s largest banks are in early discussions to launch a consortium-backed stablecoin designed for wholesale payments between financial institutions. While the project remains in development, it marks a significant shift toward tokenized money and reflects growing pressure on traditional finance to modernize cross-border settlement. Although JPMorgan’s JPM Coin is known to be part of the plan, its existing role in blockchain-based payments offers a glimpse at the kind of systems the new token may emulate.
Banks Seek Unified Digital Dollar
According to sources cited in the Wall Street Journal , institutions including Bank of America, Wells Fargo, Citigroup, and JPMorgan have held preliminary talks about creating a shared stablecoin. The initiative is being explored through joint ventures such as The Clearing House and Early Warning Services, the firm behind Zelle. The stablecoin would be fully backed by cash or equivalents and pegged to the U.S. dollar, allowing for instantaneous transactions between participants.
The token would be used in a closed-loop system, likely on a private blockchain , and target institutional settlement flows—distinct from consumer-facing crypto assets. The effort comes as banks face growing competition from faster, cheaper fintech and crypto-native payment platforms, including USDC and Tether .
JPM Coin: A Parallel Development
Though not part of the consortium discussions, JPMorgan’s JPM Coin offers a real-world precedent for tokenized bank money. Since its launch in 2019, JPM Coin has been used for intraday transfers between institutional clients, reportedly processing around $1 billion in transactions daily as of late 2023. The coin operates on JPMorgan’s Onyx blockchain and was expanded to support euro-denominated payments in 2023. Its ongoing use demonstrates that large-scale, permissioned digital cash systems can function effectively within regulatory frameworks—something the new consortium will likely consider as it evaluates architecture and compliance.
This initiative also aligns with growing momentum in Washington to regulate stablecoins. Proposed legislation, including the GENIUS Act , aims to create formal oversight for dollar-backed digital tokens. Bank-issued stablecoins—unlike those from crypto firms—may be viewed more favorably by regulators due to their transparency and backing structures. If realized, a consortium-backed stablecoin could dramatically alter the landscape for interbank payments.
