The Stablecoin Banker - Jun 5, 2025
In this issue: Circle’s IPO signals growing mainstream confidence in stablecoins as credit unions and big banks move to build blockchain-based services. Coinbase introduces x402, a new standard for internet payments, as the industry races to build out its rails.
Welcome to the latest edition of The Stablecoin Banker, a periodic newsletter from the team at Omnia to help the banking community stay on top of the most relevant stories in the stablecoin industry. We highlight top stories that are relevant to banks, with our insights and commentary to draw out the most important conclusions.
If you have questions about stablecoins for your bank, simply hit reply. Omnia is a provider of stablecoin services for banks that want to capture growing demand for stablecoins.
Here are your top stories…
📈 Crypto Firm Circle’s Shares Soar in Stock Market Debut
“FOMO helped drive up shares of crypto firm Circle in their stock-market debut,” the WSJ writes. Circle, the company behind the USDC stablecoin, went public with shares jumping from a $31 IPO price to close at $83.23 on their first day of trading. [Full Story]
Our Take: At the end of trading on its listing day, Circle’s P/E stood at 105x and price-to-net-revenue (net of distribution costs Circle pays primarily to Coinbase) was an eye watering 31x. Markets are strongly valuing the prospects of (a) the stablecoin market overall, (b) Circle’s ability to maintain and grow share, and (c) its ability to resist the pressure to share more yield that is de rigueur among every new entrant to the space.
We agree with market sentiments about the expansion of the stablecoin market. However, with new stablecoin entrants offering better yields, it’s not clear if Circle can defend and grow their P&L which remains heavily dependent on keeping stablecoin reserve yield.
📈 Credit Unions Embrace Blockchain to Leverage the Future of Trustworthy Financial Services
Credit unions are partnering with Metallicus to explore and implement blockchain technology through an Innovation Program, aiming to enhance trustworthy financial services by leveraging the Metal Blockchain for secure and compliant transactions. This collaboration, facilitated by GoWest Solutions, signals a move by credit unions to adopt emerging technologies like digital identity and stablecoins to potentially improve their offerings and member experiences. [Full Announcement]
Our Take: It’s exciting to see digital asset movement in the regulated banking space. Metallicus provides a banking-dedicated private blockchain, which provides strong assurances on compliance and security. However, private chains come with too many tradeoffs in our opinion. Private chains are closed ecosystems, and lacking adoption, volume, and operational history at scale. Some claim private chains are theoretically more secure, but we argue that any chain which has secured hundreds of billions of value in the open for many years has something better: proven security. Given the nascency of stablecoins and their uses, we think banks should prioritize open chains where usage is strongest in order to find early commercial success instead of being caught alone in a private chain.
🔮 Coinbase Introduces x402: A New Standard for Internet Payments
We’re all familiar with HTTP standards like 404 (”Not Found”) or 400 (”Bad Request”) from the earliest days of the internet. But, did you know that in 1999, the authors of HTTP version 1.1 included a placeholder code 402 for “payment required”? The authors thought that payment data could be standardized at the protocol layer of the internet. Sadly, 402 was never implemented, and we now enjoy millions of different payment entry flows, screens, and apps.
This might change with Coinbase releasing x402, a fully formed standard that “lets developers and AI agents pay for APIs, services, and software directly with stablecoins over HTTP”. [Full Announcement]
Our Take: Payments was one of the original use cases in the Bitcoin whitepaper, but remains relatively underdeveloped. For an e-commerce merchant to support stablecoin payments they need flows that support different wallets, tokens, and chains all through mobile and web browsers. It’s just too much work and bad UX. x402 is a step towards standardizing the underlying data exchange that facilitates movement of money. Stablecoins make this much simpler, and banks could provide powerful new digital wallets that allow deposit accounts to function as seamlessly, instantly, and globally as credit cards.
📈 Big Banks Explore Venturing Into Crypto World Together With Joint Stablecoin
Major U.S. banks including JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo are in early discussions about creating a joint stablecoin to compete with the growing cryptocurrency industry and prevent deposits from flowing to digital alternatives. The banks are concerned that forthcoming legal clarity from passage of the GENIUS Act, plus increased crypto support from the White House, will hasten the competitive threat from non-bank stablecoins. The GENIUS Act is set to establish a legal framework for bank-issued stablecoins. [Full Story]
Our Take: It’s easy to write off this story as another big bank crypto science project, given the many false starts in history (does anyone remember the Citigroup Regulated Liability Network?). The real story, in our opinion, is that stablecoins are becoming sufficiently standardized that there is little in the way of technical or standards uncertainty to distract major players with science projects. In fact, there seems to be enough standardization that major banks are willing to leverage their massive distribution (over 420 million accounts) to drive adoption of stablecoins.
Thanks for reading.
We focus only on the most relevant news for bankers, and so we only send updates when the news is material and relevant. If you don't hear from us, don't worry, we'll be back when there is something important to read.
Best, Davis
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