Stablecoins
But this concern, while understandable, hides larger opportunities. Resistance may be more damaging. Instead of opposing stablecoins, banks should look at them as a clear path to expand and modernize. Several major companies are already
Amid all the anxiety, what's often missing is a clear view of what stablecoins already do well. Banks should do more than tolerate them, as they are changing money movement and storage mechanisms today. For many years, transactions, especially cross-border ones, have been slow and costly. Stablecoins can
Much of this advantage comes from the infrastructure behind them. The blockchain technology at the core of the mechanism now handles hundreds of millions of transactions daily. It helps to achieve efficiency levels which are unattainable for legacy systems.
Beyond just speeding up transfers, stablecoins are beginning to influence the way people think about deposits. Instead of converting dollars back to fiat, many holders now keep their balances on-chain. This creates a parallel financial ecosystem that operates out of traditional banks' reach.
This has real financial consequences. When users hold stablecoins, the underlying collateral, like U.S. Treasury securities, remains with the issuer, not the bank. That means stablecoin issuers, not banks, earn the yield on those safe assets. Over time, this risks undermining the main source of banking revenue: interest earned on customers' deposits.
But the disruption doesn't stop there. Stablecoins are also famous for being programmable. Due to smart contracts, they automate transfers, escrows and settlements without relying on intermediaries. This hits the core of banking services — from wire transfers to trade finance — and raises questions about where banks fit in a code-built financial system.
And that threat is no longer fictional: Major companies such as
It's early, but financial institutions are getting ready to issue the digital asset.
Of course, the risks are there, and they start to be tangible, but it's not just about disruption.
While the threat stablecoins pose to traditional banking isn't going away, the question is: What do they need to do? Competing through conventional methods alone is no longer viable. Banks need to seek paths to convert the challenge into an opportunity, and the most direct of them is to issue their own stablecoins.
The motive is clear. The market opportunity is already taking shape, and banks risk being left behind. Currently, yield-bearing stablecoins have
Besides, banks have a crucial edge in being trusted and having regulatory expertise. While crypto-native firms often navigate uncertainty, banks are compliance-first by nature. And now, with clearer rules emerging — like
Also, banks must accelerate targeted fintech integrations. This means upgrading core systems, from custody to clearing, and building programmable, API-ready infrastructure that supports tokenized payments and on-chain settlement. We're already seeing this in action with Ripple
In fact, momentum is already building. Several major banks are already exploring joint stablecoin ventures — a sign that institutional interest is moving from theory to action. According to Standard Chartered, the
Ultimately, while concerns about traditional banking's sustainability remain valid, the focus shouldn't be on whether stablecoins will disrupt finance. Viewing this as a zero-sum clash between traditional finance and crypto misses real opportunities. It's more a test of who is willing to evolve. Banks contribute regulatory strength and public trust; stablecoins, in turn, bring scale, programmability and speed. This type of collaboration only strengthens the role of banks.
