It has been reported by The Wall Street Journal that discussions have been held by companies associated with JPMorgan, Bank of America, Citigroup, and Wells Fargo regarding the potential joint issuance of a stablecoin.
A collaborative effort to launch a cryptocurrency stablecoin is reportedly being explored by several of the largest banking institutions in the United States.
The possibility of a jointly issued stablecoin has been discussed by entities affiliated with JPMorgan, Bank of America, Citigroup, and Wells Fargo, according to a May 22 report by The Wall Street Journal, which cited individuals familiar with the discussions.
Additional financial institutions associated with the prospective stablecoin initiative have been identified as Early Warning Services, which owns the digital payments network Zelle, and the Clearing House payments network.
The discussions are currently at a preliminary stage, and the project’s outcome may be altered based on regulatory developments and evolving market demand for stablecoins.
It was stated by a JPMorgan spokesperson that no comment would be provided. Requests for comment were not immediately answered by Bank of America, Citigroup, or Wells Fargo.
On May 20, a vote of 66-32 was cast by the US Senate to advance deliberations on the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, which aims to regulate stablecoins.
A regulatory framework for the collateralization of stablecoins has been outlined by the bill, which also mandates adherence to Anti-Money Laundering regulations. It is now set to be debated on the Senate floor.
Earlier this week, the passage of the bill was predicted by White House crypto czar David Sacks, who stated that bipartisan support was expected to be received.
However, a clause preventing President Donald Trump and other U.S. officials from profiting from stablecoins is expected to be added to the bill by senior Democratic lawmakers through proposed amendments.
The crypto platform World Liberty Financial, which introduced the USD1 stablecoin in March, was launched by President Trump and his family. It has been argued by critics that the passage of favorable stablecoin regulations could result in personal financial gains for President Trump.
Rising Demand Fuels Stablecoin Market Expansion
Stablecoins have been increasingly sought after, with adoption being observed among nation states and interest being expressed by institutions aiming to integrate them into their operations.
The total market capitalization of stablecoins has been raised to $245 billion, reflecting a 20% increase from the $205 billion recorded at the beginning of the year.
Earlier this week, it was reported that nearly 4.5% of the total stablecoin market has been accounted for by yield-bearing stablecoins, with their circulating supply being estimated at $11 billion.
Austin Campbell, a professor at New York University and the founder of Zero Knowledge Consulting, stated that a sense of panic has been exhibited by the American banking lobby, as stablecoins are perceived as a disruptive force to the conventional banking business model.
Earlier this month, reports indicated that efforts were being made by tech giant Meta to explore the integration of stablecoin payments into its platforms.
