- Twenty-one companies, including big banks and financial institutions, have joined forces to launch a US dollar stablecoin by the first half of 2027.
- Circle stocks plunged at the news, but also had a big announcement up its sleeve.
Twenty-one companies worldwide, including big banks, are banding together to secure a significant share of the burgeoning stablecoin market. Ironically, some American banks in their ranks have been a thorn in the Digital Asset Market CLARITY Act, causing undue delays in the bill’s progress by blocking its provision on stablecoin yields.
The New Stablecoin Initiative
On Tuesday, large financial institutions, including Bank of America, Goldman Sachs, Citi, Deutsche Bank, UBS, Santander, MUFG and Fidelity Investments, have reportedly hatched a plan to form a corporate entity before year-end. The WSJ revealed that their ultimate goal is to launch a stablecoin during the first half of 2027.
Details are very limited at this point, but based on available data from various reports and industry insiders, the consortium initially targets a stablecoin pegged 1:1 with the US dollar. After all, it’s the most dominant medium of exchange in global finance, and its influence extends farther to the digital asset ecosystem.
To date, the stablecoin sector makes up roughly 12% of the crypto market’s $2.59 trillion value. Overall, these fiat-pegged digital assets hold a market cap of approximately $313 billion.
Leading the charge are US dollar-denominated stablecoins, with Tether’s USDT dominating the pack at a valuation of more than $183 billion. Next is Circle’s USDC, with a $73.48 billion market cap.
If successful, the group will follow it up with stablecoins pegged to other G7 currencies. A euro-denominated token is next on the list.
The Target Market
The association’s joint stablecoin initiative focuses on wholesale and institutional markets, streamlining their cross-border interbank settlements to lower fees and speed up transfers. It also aims to provide liquidity for digital asset trading.
Additionally, the asset offers a medium for retail and commercial users in their daily transactions. The same robust liquidity enables faster and cheaper payments and remittances.
Moreover, the group plans to leverage public blockchain infrastructure to compete directly for open-market liquidity.
Circle Stock Slides
Circle once again bore the brunt of the incoming major competition with a sharp decline in its shares on the New York Stock Exchange (NYSE). CRCL fell to $88.11 per share on Tuesday afternoon from a previous close of $95.55 and an opening bell price of $92.12.
Nonetheless, the world’s second-largest stablecoin issuer had a major update up its sleeve amid the latest developments. On the same day, it announced a partnership with OKX to expand USDC liquidity and trading utility across the crypto exchange’s ecosystem.
The move expands USDC’s utility in active trading workflows on the OKX platform to include spot margin and futures trading.
