Inspired by Tether’s success, major banks are increasingly interested in stablecoins. Societe Generale’s Forge has already launched a euro-backed stablecoin for retail investors, while companies like Revolut and a Deutsche Bank venture called AllUnity are considering their own versions. American banks are likely to follow once stablecoin legislation is passed. Visa is also entering the space, launching a tokenization network to help banks issue stablecoins. With banks actively developing stablecoin offerings, this could legitimize stablecoins as a credible asset class and enhance their role in cross-border payments, providing faster and more cost-efficient transactions while reducing Market volatility risks.
Big Banks Turn Their Eyes Toward Stablecoins
The success of Tether is inspiring major banks around the globe to explore the world of stablecoins. Reports indicate that some financial giants are not just observing the trend but actively participating. Notably, Societe Generale – Forge has already launched a euro-backed stablecoin for retail investors. Companies like Revolut are looking into creating their own stablecoins, alongside AllUnity, a project backed by Deutsche Bank’s DWS.
In the U.S., banks are preparing to enter the stablecoin Market, waiting for new legislation from Congress to clear the way. This mirrors trends in Europe where the new Markets in Crypto Assets (MiCA) regulation allowed banks to take more initiative. Tether’s recent decision to retire its EURt stablecoin has opened doors for competition, making it a ripe time for others to jump in.
Jean-Marc Stenger, CEO of SG-Forge, believes that more banks will begin issuing their own stablecoins in the future. His firm is already in talks with local banks and is considering partnerships to facilitate stablecoin creation. Visa is also getting involved by launching a tokenization network aimed at helping banks issue stablecoins. They have reported interest from banks in markets like Hong Kong, Singapore, and Brazil.
The large-scale distribution network of Visa enhances the credibility of stablecoins, potentially leading to greater adoption. Analysts believe that as more banks embrace stablecoins and adhere to regulatory guidelines, these digital currencies could be seen as a legitimate asset class.
Stablecoins are rapidly becoming essential for cross-border transactions, as they help reduce the high fees and slow processing times that usually plague these operations. The emergence of blockchain technology has made these transactions faster and more efficient. As the role of stablecoins in finance continues to expand, their influence on international payments could indeed transform the financial landscape.
Tags: Stablecoins, Tether, Societe Generale, Revolut, Visa, Blockchain, Cryptocurrency, Digital Assets.
What is Tether and why is it important?
Tether is a type of digital currency called a stablecoin. It is tied to the value of real-world money, like the US dollar. This makes Tether less volatile than other cryptocurrencies, which is why banks and investors are paying more attention to it.
How has Tether’s success influenced banks?
Tether’s growth shows banks that stablecoins can be reliable and popular. This success encourages banks to explore creating their own stablecoins, which could help them stay competitive in the digital finance world.
Are stablecoins different from regular cryptocurrencies?
Yes, stablecoins like Tether are designed to keep a stable value, while regular cryptocurrencies, such as Bitcoin, can have big price swings. This stability makes stablecoins more appealing for transactions and savings.
Why are people interested in using stablecoins?
People like stablecoins because they combine the benefits of digital currencies with the stability of traditional money. They can be used for easy transactions, sending money across borders, or even saving without worrying about losing value quickly.
What does the future hold for stablecoins like Tether?
The future looks bright for stablecoins, as more banks and businesses may adopt them. This could lead to wider acceptance and use, making digital currencies a common part of everyday finance.
