U.S. Bancorp, one of the largest banks in the United States, has deepened its strategic push into digital assets by initiating tests of its own stablecoin on the public Stellar blockchain for institutional payments and custody.
The Minneapolis-based financial institution, with assets exceeding $680 billion, is positioning itself within a global “crypto gold rush” and responding to rising institutional demand for digital assets.
Its move aims to capture a share of the stablecoin market, which has surpassed $300 billion in global circulation this year.
President and CEO Gunjan Kedia first outlined the bank’s work on stablecoins during its third-quarter earnings call in October. He specified two key focus areas: custody and payments.
Kedia noted customer demand for payments was “more moderate” compared to interest in custody services.
The stablecoin is being developed for transactions on Stellar, a public blockchain launched in 2014 and specifically designed for financial services. Bloomberg first reported the development on Tuesday.
This initiative seeks to integrate the stablecoin into U.S. Bancorp’s services for institutional clients, aiming to facilitate faster cross-border transfers and settlements.
The current trial follows the bank’s decision two months prior to resume Bitcoin custody services for institutional clients. This offering, initially launched in 2021, had been paused due to U.S. regulatory requirements.
The resumption was supported by a clearer regulatory framework in the United States, signaling renewed confidence in digital assets.
U.S. Bancorp’s strategy aligns with a broader trend among traditional financial players. Competitors such as JPMorgan Chase, Citi, and Bank of America are also exploring similar blockchain-based solutions.
While the bank has not provided a commercial launch date for the stablecoin, sources familiar with the project indicate that testing will continue in the coming months.
The ongoing trials underscore the increasing integration of blockchain technology into conventional financial systems globally.