A group of banks including Bank of America , Citi, Deutsche Bank, Goldman Sachs and UBS will work together to explore creating blockchain-based assets pegged to G7 currencies, the banks said on Friday.
The project, which is in its early stages, will explore creating assets on public blockchains which are pegged 1:1 to real-world currencies – known as stablecoins.
Various banks and other financial institutions have announced plans to look at launching stablecoins, as soaring crypto prices and U.S. President Donald Trump’s support for the sector has sparked a revival of interest in the idea of using blockchain in the mainstream financial system.
The market for stablecoins, however, is dominated by the El Salvador-based Tether, which accounts for $179 billion of the $310 billion worth of stablecoins in circulation, according to CoinGecko.
“The objective of the initiative is to explore whether a new industry-wide offering could bring the benefits of digital assets and enhance competition across the market, while ensuring full compliance with regulatory requirements and best practice risk management,” the statement said.
The banks involved are Santander, Bank of America, Barclays, BNP Paribas, Citi, Deutsche Bank, Goldman Sachs, MUFG Bank Ltd MTFGTU.UL>, TD Bank Group and UBS.
France’s Societe Generale, which was not included in the list, became the first major bank to issue a dollar-backed stablecoin through its digital asset subsidiary earlier this year. The token has not been widely adopted, with just $30.6 million in circulation.
A separate consortium of nine European banks including heavyweights ING and UniCredit, said last month they were forming a new company to launch a euro-denominated stablecoin.
