Major U.S. banks are accelerating efforts to integrate stablecoins into their operations following the passage of the GENIUS Act, a law signed this summer by President Donald Trump that created a regulatory framework for dollar-pegged digital tokens. Institutions including JPMorgan, Bank of America, and Citi are actively developing interbank payment systems and customer-facing products based on stablecoins, reversing years of public skepticism toward the crypto sector.
The shift comes as banks confront the growing popularity of blockchain-based financial tools, the prospect of competing coins from tech and retail giants like Amazon and Walmart, and political support from the Trump administration. Previously vocal critics of crypto—including JPMorgan CEO Jamie Dimon and Bank of America’s Brian Moynihan—have now overseen internal crypto task forces and development programs, including JPM Coin and other tokenized instruments.
The GENIUS Act requires that stablecoins be fully backed by U.S. dollars or Treasury securities, with the interest on those assets accruing to issuers. However, unlike traditional bank accounts, funds held in stablecoins do not generate interest for customers and are not insured by federal programs such as the FDIC.
Executives privately acknowledge that the introduction of stablecoins poses structural challenges to the traditional deposit-based banking model. Money exchanged for stablecoins cannot be lent out in the same way as typical bank deposits, which could constrain credit creation. The Federal Reserve Bank of Kansas City recently warned of potential macroeconomic risks stemming from this transition.
Despite public assurances, concerns remain. One senior banking attorney said that if banks were being completely candid, they would admit they wished stablecoins had never been invented. Nonetheless, institutions are proceeding with caution. Banks are considering joint issuance of a single, large stablecoin while simultaneously preparing individual alternatives. Some firms are exploring customer incentives, such as rewards programs, to drive adoption.
Tim Spence, CEO of Fifth Third Bank, said he believes consumer checking accounts are likely to remain intact, but acknowledged the bank’s plans to support stablecoins issued by a consortium of lenders. Moynihan of Bank of America confirmed his institution is evaluating stablecoin use cases, though he admitted it is unclear whether adoption will be driven by individual banks or broader industry coalitions.
The momentum has been shaped not only by technological factors but also by the changing political environment. Trump, once a critic of cryptocurrencies, has become a vocal supporter. His sons reportedly run a crypto venture that may benefit from the regulatory changes. Senator Kirsten Gillibrand, one of the Democratic co-sponsors of the GENIUS Act, said the legislation opens the door for the next generation of financial innovation.
While no major bank-issued stablecoin has launched yet, insiders suggest announcements could come before the end of the year. Until then, the sector is preparing for what could be the most significant transformation of the U.S. banking system since the digital revolution began.