February 2nd, 2026

Four stablecoin developments bankers should know about

🔥 I hosted a webinar last week on Stablecoin Use Cases for banks. It struck me that bankers and stablecoin people talk a lot about the technology, but I suspect many have never used it - so I decided to do a demo-heavy webinar showcasing the power of tokenized money on-chain as experts use it today, and bridging back to how banks can engage today. If you missed it, check out the replay.

The Stablecoin Banker is a periodic newsletter keeping bankers on top of the stablecoin industry. I highlight top stories that are relevant to banks, with my insights and commentary to draw out the most important conclusions.

If you find this content useful, please feel free to forward it to your friends and colleagues. They can also subscribe directly. If you’re interested in stablecoin services for your bank, feel free to reach out to us at Omnia.

"We're not going to have a separate banking industry and crypto industry. It's going to be one digital assets industry." — David Sacks, White House AI and Crypto Czar (January 21, 2026)

In This Issue

• Fidelity and Tether launch regulated stablecoins—but distribution remains the question
• DXC Technology partners with Ripple to bring stablecoin infrastructure to major banks
• Standard Chartered warns of $500 billion deposit outflow to stablecoins by 2028
• NYSE announces 24/7 tokenized trading platform

Plus, tidbits you may have missed in our Coupon Clippings section.

Two Giants Launch Stablecoins—Now Comes the Hard Part

Fidelity Investments announced it will launch the Fidelity Digital Dollar (FIDD) in early February—a fully reserved, Ethereum-based stablecoin issued by its federally chartered subsidiary, Fidelity Digital Assets, National Association. With $5 trillion in assets under management serving 50 million individual investors and 23,000 financial institutions, Fidelity becomes the largest traditional asset manager to issue its own stablecoin. A day earlier, Tether announced USA₮, its first U.S.-regulated stablecoin issued through Anchorage Digital Bank under the GENIUS Act framework. Tether, which manages approximately $180 billion in stablecoin reserves and generated over $15 billion in net income in the first nine months of 2025, is bringing its offshore stablecoin dominance into compliant U.S. markets for the first time. [Sources: Fidelity, CoinDesk, Tether]

My Take:

These are both substantial new issuers, but neither have yet indicated how they will approach distribution. Fidelity brings massive customer relationships and regulatory credibility but operates in a walled garden. Tether brings global distribution and payment network effects but still needs to attract users to USA₮.

Fidelity emphasizes that FIDD will be available to retail and institutional investors across its three digital assets products, including Fidelity Crypto for Wealth Managers, in addition to being available on major crypto exchanges. The platform allows users to withdraw the token on-chain, where they can use it in defi protocols, or transfer to other platforms and exchanges. Since no other stablecoins are available on Fidelity, its users will only access FIDD, which should help them bootstrap counterparty acceptance from scratch.

Tether faces the opposite challenge. The company dominates global stablecoin issuance with USDT circulating across every major blockchain and cryptocurrency exchange. Rather than make USDT GENIUS-compliant, Tether chose to launch a parallel token in the US where it has lagged USDC. In this sense, they are not able to leverage their existing distribution directly to support the new token. I suspect they will focus USA₮ marketing on international use cases, leveraging their strength in USDT distribution combined with issuer-provided swaps that make it simpler to move money on Tether-only stablecoins instead of from USDC to USDT as is done today.

With an increasing number of institutional stablecoins, smaller banks can start testing options for engaging without issuing.

Option 1: Market their own distribution to issuers under exclusive deals, allowing their depositors to mint and withdraw only one issuer’s coin in return for marketing incentives (still legal!) especially when those incentives persist after the stablecoin has left the bank. These deals help the issuer increase distribution and add additional on-/off-ramp nodes in their network.

Option 2: Grant user access only to stablecoins from issuers that maintain reserves with the bank. This may be more lucrative for the bank, but it’s a harder bargain to drive because issuers have a Goldilocks preference for the right number of bank partners. Too many and reserve management gets overly complex.

Either way, banks can be the solution to issuers’ distribution challenges - for a fee 😃

Ripple's Big Bank Play: A Walled Garden Dressed Up as an Open Door

DXC Technology, which provides core banking systems for major banks representing $5 trillion of deposits, announced a strategic partnership with Ripple on to integrate Ripple's digital asset custody and payment infrastructure into DXC's banking solutions. The partnership will enable DXC's bank clients to offer stablecoin custody, cross-border payments, and treasury services using Ripple's technology stack, with RLUSD (Ripple's dollar-backed stablecoin) as the primary settlement instrument referenced. [Source: PRNewswire]

My Take:

Ripple is somewhat unique among the larger blockchains in how it has systematically built out its own services stack. Major blockchains like Ethereum, Solana and Base focus their resources on encouraging a ecosystem of providers to support their chains and assets. Ripple, by contrast, has, through development and acquisition, built a full complex of services: Custody and licensing from the purchases of Standard Custody, Metaco, and Palisaide; payments from Rail; prime services from Hidden Road; and, treasury software from GTreasury.

I can imagine the value proposition is compelling for a bank. With a DXC integration, Ripple can offer a comprehensive solution to DXC banks in a market with no established substantial all-in-one providers. However, this comes with a tradeoff: because of it’s approach, Ripple has not created a vibrant ecosystem of users. Where UniSwap - the leading trading venue on Ethereum -processed $1.7Bn of in the last 24 hours as of writing, the top exchange on Ripple did $76 thousand. Ripple processes around 1 million transactions per day, compared to 100 million on Solana. RLUSD moved $3 billion last month, versus USDC’s $8 trillion.

With an anemic ecosystem but a substantial first-party services stack, Ripple may just end up looking like existing offers from FIS or Fiserv. Look at the treasury-payments use case: the corporate treasurer uses Ripple Treasury to manage funds loaded into Ripple’s stablecoin RLUSD via a FBO bank relationship owned by Ripple, and make payments using RLUSD through a liquidity point contracted and managed by Ripple. Since Ripple operates all of it, the blockchain is really just functioning like a Ripple-managed database, and RLUSD is just a yield-inefficient money market fund. This could largely be accomplished today with some pre-funding and good banking relationships.

Still, they will pursue the XRP Ledger/RLUSD story because Ripple Labs currently holds approximately 40% of the supply of XRP, valued at $40 billion. While most banking and finance companies are launching on Ethereum, Base or Solana, Ripple needs institutional adoption to propel the 10-year narrative of Ripple as a new global financial rail. Ostensibly, their services provide access to other chains and assets, but Charlie Munger’s famous quote is worth repeating: “show me the incentive, and I'll show you the outcome”. This isn't unique to Ripple. Any provider that controls both the infrastructure and the native asset/blockchain will optimize for the asset's adoption over the bank's interests. The DXC partnership just makes it unusually visible.

For banks, there are two critical considerations here. First, there is a long history of failed attempts to bootstrap liquidity on blockchains. Adopting digital assets presents enough novel challenges - stick to the venues with maximum liquidity and counterparty availability. Second, novel financial products that should interest banks won’t come in walled gardens. The power of tokenization lies in mixing and matching many kinds of assets with smart contracts in a vibrant ecosystem of market participants. Maybe you are starting with safe and simple use cases that can’t leverage these unique capabilities, but in order to successfully navigate the coming evolution of banking, you’ll need them. Start with the right foundation today.

NYSE Dives Into Tokenized Trading - But Not for Your Bank

The New York Stock Exchange announced that it is developing a platform for round-the-clock trading and on-chain settlement of tokenized stocks and ETFs, pending regulatory approval. The platform will combine NYSE's Pillar matching engine with blockchain-based post-trade systems supporting multiple chains for settlement and custody, and will feature 24/7 operations, instant settlement, dollar-denominated orders, and stablecoin-based funding. NYSE is partnering with BNY Mellon and Citi to support tokenized deposits across ICE's clearinghouses, enabling clearing members to transfer funds and meet margin obligations outside traditional banking hours. The company is targeting a launch later this year pending regulatory approval from the SEC and other authorities. [Sources: NYSE/ICE, Bloomberg]

My Take:

The New York Stock Exchange's tokenization platform is great for the NYSE, for the major banks, and for the specialist firms that dominate securities trading and settlement. For everyone else, it's a missed opportunity disguised as innovation.

Columbia Business School Professor Omid Malekan called the NYSE announcement "vaporware" in a Fortune column last week, and his critique cuts to the heart of the problem: the NYSE is deploying blockchain technology to optimize the existing oligopoly, not to disrupt it. The platform keeps all the same intermediaries—transfer agents, broker-dealers, clearing firms—and simply uses blockchain to make those relationships run faster. As Malikin put it, they're doing "tokenization their way with all the same exact intermediaries and partners that they deal with today."

Transfer agents exist to track who owns which shares—a function blockchain does better, cheaper, and without counterparty risk. But instead of replacing transfer agents with blockchain infrastructure, the NYSE is asking how transfer agents can use blockchain technology. That's backwards. The right question is: which participants do you actually need in a tokenized capital market?

Community and regional banks should be the loudest voices demanding regulatory frameworks for DeFi trading venues, direct on-chain issuance, and permissionless access to tokenized markets. If securities traded on open protocols rather than closed NYSE platforms, smaller banks could offer trading and custody of tokenized equities, money market funds and bonds without needing relationships with the custodial oligopoly. The result of inaction is predictable: top-tier banks get NYSE's tokenized platform, offer 24/7 trading, integrate stablecoin settlement, and capture fees from next-generation infrastructure.

The idea that NYSE tokenization will ultimately democratize access is exceedingly unlikely. See the Munger quote above. The structural changes needed to benefit smaller banks will come not from the big banks, NYSE, or other entrenched participants. It will come from the startups and crypto natives that have been pushing for legitimization for a decade. Banks that understand they need to reimagine themselves this decade would benefit by getting behind this movement — and paying attention to what's already happening outside the NYSE's walls.

Coupon Clippings

Standard Chartered: $500 Billion Deposit Flight to Stablecoins by 2028

Standard Chartered released analysis projecting that one-third of stablecoin market growth through 2028 will come from developed market bank deposits—totaling approximately $500 billion. The bank identifies U.S. regional banks as most exposed, arguing they rely more heavily on net interest income than diversified money-center banks. Geoff Kendrick, Standard Chartered's Global Head of Digital Assets Research, warned that "U.S. banks face a threat as payment networks and other core banking activities shift to stablecoins." This makes sense since US banks still gate access to the payments networks - anyone that needs to make a payment ultimately ends up with deposits at a bank - and maintain primacy of the checking account. As the innovation gap between banks and non-banks grows, these advantages become less defensible. [Full Story: CoinDesk]

BitGo IPO Pops 25% on NYSE Debut

BitGo Holdings began trading on the New York Stock Exchange on January 22 under ticker BTGO, pricing its IPO above the expected range at $18 per share and raising $212.8 million. Within hours of the debut, Ondo Finance announced it would tokenize BitGo stock for on-chain trading across Solana, Ethereum, and BNB Chain. BitGo, founded in 2013, manages over $100 billion in digital assets for institutional clients. The successful debut validates that public markets see value in crypto infrastructure businesses and signals renewed investor appetite for digital asset IPOs. [Full Story: TechStartups]

Zerohash Chooses Independence Over Mastercard's Billions

Crypto infrastructure firm Zerohash walked away from acquisition talks with Mastercard and is now in discussions to raise $250 million at a $1.5 billion valuation, opting to remain independent despite Mastercard's reported interest in a multi-billion dollar acquisition. The company, which provides B2B crypto infrastructure for trading, custody, and settlement, appears confident in its standalone growth prospects rather than becoming part of Mastercard's payments network. [Full Story: CoinDesk]

Old Glory Bank Going Public via SPAC

Old Glory Bank, a pro-crypto online banking platform, announced a business combination agreement with Digital Asset Acquisition Corporation (Nasdaq: DAAQ) to become publicly listed on Nasdaq at a $250 million valuation. The Texas-based bank, which has positioned itself as serving customers "de-banked" by other institutions, will combine with the SPAC in a transaction expected to close in Q1 or early Q2 2026. It will join the growing ranks of teams tackling the same strategy including de novo applicants Erebor (approved) and Augustus (applied to OCC on Dec 18) [Full Story: Business Wire]

Thanks for reading. If you don't hear from us for a bit, don't worry—we'll be back when there's something important to share.

Best,

Davis