U.S. banks are proceeding with caution regarding stablecoins, even as the market experiences rapid expansion. This hesitant approach stems from evolving strategies and significant structural concerns, as detailed in a recent S&P Global Market Intelligence report.
The report indicates a dominant wait-and-see attitude among financial institutions. A survey of 100 U.S. banks revealed that only 7% are developing stablecoin frameworks, with none actively piloting. Jordan McKee, director of fintech research at S&P Global Market Intelligence, noted that stablecoin strategy remains largely exploratory, with limited internal development.
Stablecoins, digital tokens pegged to assets like fiat currency, have become a critical component for payments and settlements in the cryptocurrency space. The market, estimated at over $316 billion, is led by Tether's USDT and Circle Internet's USDC. Transaction volumes are in the tens of trillions annually.
Banks are increasingly concerned about potential deposit cannibalization and customer migration to stablecoin ecosystems. The passage of the GENIUS Act in July 2025 has also amplified regulatory scrutiny. Furthermore, non-banking entities are actively pursuing charters for stablecoin issuance and custody, presenting direct competition.
While large global banks may explore issuing tokenized deposits, regional and midsize lenders are expected to focus on providing fiat on- and off-ramps. Regardless of their approach, banks will be essential intermediaries for stablecoin networks, necessitating significant upgrades to legacy systems. Cross-border banks, in particular, face pressure to modernize as payment systems evolve towards multi-rail networks.