Coinbase announced pilot programs with leading U.S. banks this week, aiming to test the viability of stablecoins, custody solutions, and crypto trading, according to CEO Brian Armstrong’s comments. The trials come amidst a fluctuating cryptocurrency market that has seen prices stall since October. 🤝 📈 🏛️
Armstrong emphasized that the participating banks view crypto as a legitimate business line rather than just a side project, and the efforts are being conducted within regulated institutions. He also highlighted the favorable regulatory climate under President Trump’s second term.
The initiative was further discussed at the New York Times DealBook Summit, where CEO Larry Fink of BlackRock Inc., spoke on transforming stocks and real-world assets into tokens, emphasizing Bitcoin’s potential use in financial systems.
This renewed involvement from Wall Street comes after a shift in US policy regarding cryptocurrencies, including stablecoin regulation that has allowed dollar-pegged tokens for faster payments. 🇺🇸💰 🤖
Despite this recent progress, the recent decline in cryptocurrency prices is linked to factors like tariff announcements and leveraged trades. Tokens associated with figures tied to President Trump experienced significant drops. Brian Armstrong asserted his long-term outlook on crypto market value remains optimistic.
However, Larry Fink believes that $4.1 trillion currently stored in digital wallets, mostly stablecoins, presents a significant opportunity for greater financial fluidity if other assets are also digitized and tokenized. 📈
The new stablecoin law has sparked renewed debate about the potential impact of these tokens on U.S. funding needs and the stability of the dollar.
Several key figures within the financial sector have offered insights into the matter, including Scott Bessent, U.S. Treasury Secretary, who believes the market for dollar-backed stablecoins could reach $3 trillion by 2030 from approximately $300 billion currently. 📈
Meanwhile, experts from JPMorgan, Deutsche Bank, and Goldman Sachs are cautious about treating stablecoins as a quick fix for U.S. funding needs. Stephen Miran, a Fed governor and White House chief economist, suggests that demand in the United States may remain limited.
The potential impact of stablecoins on global financial markets is being actively explored by both central banks like the European Central Bank and the People’s Bank of China. 🌎
Standard Chartered predicts up to $1 trillion could move away from banks in developing nations by 2028 as funds flow into stablecoins. This risk has driven the European Central Bank and the People’s Bank of China to focus on their own digital currencies.