Banks Warm Up to Stablecoins Amid Shift in Demand

Circle Internet Group (NYSE:CRCL) shares fell 4% on Wednesday after The Wall Street Journal reported that banks are warming up to the idea of launching their own stablecoins. This marks a shift from earlier doubts about demand, with some bank executives now considering whether there could be a need for both stablecoins and tokenized deposits.

The report noted that major nonbank companies such as Visa, BlackRock, Google, and DoorDash have moved to get involved in the stablecoin market. JPMorgan Chase has evaluated whether it could launch its own stablecoin, according to people familiar with the matter cited by The Wall Street Journal. However, a JPMorgan spokeswoman stated that the bank has no plans to issue a stablecoin but would evaluate all options depending on customer demand and regulatory developments.

A group of more than a dozen financial institutions, including Bank of America, Wells Fargo, and Santander, is moving forward with a stablecoin venture that would reach across the globe. This development comes after banks previously opposed crypto firms offering stablecoins that would act like bank deposits, instead launching their own tokenized deposit system.