Breaking: Bank of America Reportedly Working on Launching a Stablecoin

According to recent reports, Bank of America is planning to develop its own stablecoin. Fueling speculations, CEO Brian Moynihan confirmed the bank’s vision to establish a fully dollar-backed stablecoin. The bank’s move reflects the increasing adoption of digital currencies among mainstream financial players.

Bank of America Stablecoin Plans

Recent reports indicate that Bank of America is in the process of developing a stablecoin pegged to the U.S. dollar. CEO Brian Moynihan stated that it is “pretty clear” that the bank is moving forward with the project. This comes after previous remarks in March wherein Moynihan stated that the bank was “compelled to” study blockchain technology and digital currencies in order to keep up with the competition.

First, there were rumors of a collaboration with JPMorgan to introduce the stablecoin, but currently, it seems that Bank of America is working on the project independently.

The shift is an indication of how stablecoins are gaining recognition over their potential to provide efficiency in payments and lowering the overall cost of transactions within the financial sector. With this stablecoin, the Bank of America would have a chance to expand its cross-border payment opportunities, remittances, and other financial services.

Growing Interest in Stablecoins

Stablecoins, which are designed to maintain a stable value while leveraging the benefits of blockchain technology, have seen a surge in interest in recent years. These digital currencies are becoming popular for their ability to offer faster and more cost-effective transactions, bypassing traditional banking systems.

The rising demand for stable assets is evident, with a report from Coinbase showing that stablecoin transaction volume hit $27.6 trillion in 2024.

As the use of stablecoins continues to grow, the percentage of Fortune 500 companies exploring or using stablecoins has increased dramatically. In 2024, 29% of these companies expressed interest in stablecoins, up from just 8% the year before. This growing enthusiasm is largely driven by the need to overcome challenges related to traditional payment systems, such as slow processing times and high fees.

Regulatory Landscape and Industry Reactions

The report of this project at Bank of America could not have come at a more crucial moment, as regulators are considering the emergence of digital currencies.

The transparency of the stablecoin issuers and potential threats they may impose on financial stability have also been questioned. Regulators around the world are trying to create stablecoin frameworks in light of these concerns including in the US, the Senate.

In addition to the plans of the Bank of America, another financial institution, Societe Generale, a French-based firm has joined the industry. Société G generale declared that it is intending to issue a publicly tradable, dollar-pegged stablecoin named USD CoinVertible, through its digital asset subsidiary, SG-FORGE.