February 26, 2026

4 stablecoin developments bankers should know about

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.

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🎤 I joined the Tokenized Podcast last week to discuss Payoneer's stablecoin plans, trust charters, tokenized deposit networks, and on-chain lending.

"I want competition in payments to drive down the cost for households and consumers, and businesses. That's it. If stablecoins present a lower-cost alternative to consumers and businesses, I am all for it."
— Fed Governor Chris Waller (Feb 24)

In This Issue: Institutions shift to public blockchains, banks back private ones • SEC broker-dealer update brings stablecoins closer to cash • Stripe gave the web its checkout button • Stablecoin adoption reaches the last mile

In This Issue

• Institutions shift to public blockchains, banks back private ones
• SEC broker-dealer update brings stablecoins closer to cash
• Stripe gave the web its checkout button
• Stablecoin adoption reaches the last mile

From Walled Gardens to Public Rails

Citigroup executed the full lifecycle of a tokenized bill of exchange on Solana. On February 20, BNP Paribas Asset Management issued tokenized shares of a money market fund on Ethereum. This follows an earlier tokenized MMF pilot the bank conducted on a private blockchain. Apollo announced a cooperation agreement with Morpho, a lending protocol available on multiple public blockchains, that anticipates Apollo acquiring up to 90 million MORPHO tokens and supporting on-chain lending. Against this backdrop, five US regional banks — Huntington, M&T, KeyCorp, First Horizon, and Old National — announced Cari, a private tokenized deposit network targeting 24/7 instant bank-to-bank transfers with FDIC-insured deposits, with MVP in March 2026 and commercial launch in Q4. The network is led by Eugene Ludwig, who served as US Comptroller of the Currency under President Clinton and later founded Promontory Financial Group. [Stabledash, BNP Paribas, Morpho, Bloomberg]

My Take:

Institutions are increasingly launching products on public chains, and in the case of Citi and BNP, doing so after experimenting with private chains. Citi tried to build its Regulated Liability Network on a private, permissioned chain. BNP previously issued tokenized money market fund shares on a private blockchain in Luxembourg. Citi, which has an extensive global branch network, could easily have tokenized a bill of exchange privately on an internal network, but instead it chose Solana. Blockchains are powerful because they standardize transactional activity without handing control to a private party. Private/permissioned chains struggle to attract participation because central control dissuades users and slows adoption. Major FIs are coming to understand this.

Cari is taking the other path in building a private, permissioned chain. Moreover, it appears they are positioning as a full-stack provider for members rather than fostering an ecosystem of developers. The first use case is payments: instant bank-to-bank payments with net settlement. This sounds similar to the value proposition of RTP or CHIPS on The Clearing House, and unsurprisingly, three of the Cari design partners — M&T, Huntington, and KeyCorp — are also owners of The Clearing House.

How will this project evolve from a tokenized version of RTP into more interesting use cases for tokenized deposits? Since they are building a private chain, and one that doesn't use a common technology like the Ethereum or Solana Virtual Machine, interoperability with public chains will be hard. Just ask any digital assets expert about cross-chain bridges to understand why. The other choice will be to build an entire on-chain ecosystem at the moment that major FIs are going the other direction. Attracting the users and liquidity will be a substantial challenge, but perhaps manageable with the backing of large regionals. On the other hand, even JPMorgan is building its deposit token on a public blockchain.

The SEC Says Stablecoins Are (Almost) Cash

On February 19, the SEC's Division of Trading and Markets updated its crypto asset FAQ to clarify that broker-dealers may apply a 2% net capital haircut to qualifying payment stablecoin positions under Rule 15c3-1. Prior to this guidance, broker-dealers applied haircuts approaching 100% out of regulatory caution. The 2% figure places payment stablecoins in the same risk tier as government money market funds (cash carries a 0% haircut). Commissioner Hester Peirce issued a concurrent statement calling for formal rulemaking to amend Rule 15c3-1 directly rather than relying on FAQ guidance. [The Block]

My Take:

The SEC is making a specific judgment: that the stablecoin tokenization layer adds no incremental risk to the asset. Their 2% haircut essentially looks through the token to the underlying stablecoin reserve assets which closely resemble a money market fund.

While this update only applies to principal positions held by broker-dealers, it reflects thinking at the SEC that could lead to a reclassification of stablecoins to cash equivalents under GAAP, which would have a substantial impact on public and private companies. With guidance from GAAP, banking regulators would find it easier to argue that bank-owned stablecoin assets should be granted look-through treatment for capital requirements. Under BASEL III, this would apply a risk weight of 0-20%, making bank-held stablecoin assets as capital efficient as bank deposits and US Treasuries.

Stablecoins are continuing their march up the balance sheet, getting ever closer to being formally treated as money.

The Internet Finally Gets a Checkout Button

This week, Stripe enabled blockchain-based payments for AI agents. Using the new x402 implementation, merchants can now programmatically charge agents for access to data on a per-request basis. CoinGecko is the launch partner, charging $0.01 per data API call using the Stripe infrastructure. Payments are made using USDC on the Base blockchain, with plans to expand token and blockchain support. Coinbase simultaneously announced Agentic Wallets — programmable spending accounts with configurable limits, approval workflows, and audit trails — as the wallet-side infrastructure for autonomous systems making x402 payments. [The Block, Coinbase]

My Take:

The AI agent framing gets the attention, but the story underneath is 30 years in the making. The reason micropayments never happened on the internet was economic and experiential. The economics of credit card interchange and processing fees make a $0.01 transaction structurally absurd. The idea of filling out a credit card payment form to make a $0.01 transaction is likewise headache inducing. We needed stablecoins to make this work because they are the digital equivalent of cash. Now, the internet has a native, frictionless payment primitive that works at any denomination.

Machines paying machines for API calls is today's proof of concept, but the more consequential shift is what x402 does to the checkout experience more broadly. With x402, a browser can programmatically negotiate which payment method to use in any web-based checkout — weighing the cost and benefits of your credit card, debit card, digital wallet, and stablecoin balance in real time, including merchant incentives. That's not a crypto story. That's a fundamental change to how payment choice works, and it happens at the wallet layer.

Banks are looking for ways to evolve their businesses to compete with fintechs and maintain their customer base. The opportunity with x402 will be to power the user's wallet. The institution that can provide stablecoins alongside card and deposit products controls the funding source for this new payment layer. Banks already have the trust and the relationship, and now need the stablecoin product.

Stablecoin Adoption Reaches The Last Mile

Three announcements this week signal a shift in where stablecoin adoption is now occurring. Payoneer — which has processed payments for nearly two million small and medium businesses across 190 markets — announced that it will embed stablecoin capabilities provided by Bridge directly into its platform. The integration will enable Payoneer's business customers to receive, hold, and send stablecoins as part of their existing workflows, with fiat interoperability throughout. Two weeks later, Payoneer filed for an OCC national trust bank charter to issue PAYO-USD, its own stablecoin, with Bridge still handling blockchain orchestration. Separately, Modern Treasury — which processes over $400 billion annually through integrations with more than 20 major U.S. banks — announced a unified payment API that places stablecoins alongside ACH, wire, RTP, and FedNow as peer payment options for enterprise treasury teams. Finally, Meta confirmed it is in early stages of integrating third-party stablecoin rails for creator payouts and international transfers, targeting H2 2026. [Payoneer, Modern Treasury, CoinDesk]

My Take:

In late 2025, the stablecoin story was written by digital asset companies — charter applications, M&A, product launches. The story has changed. Payoneer and Modern Treasury are not crypto companies. They are the payment infrastructure business customers already use, and they are embedding stablecoins directly into existing workflows. Meta has two billion consumers on its platform, with millions of creators that will benefit from stablecoin payouts.

The message is consistent across all three: stablecoins are becoming a peer rail alongside ACH, wire, and RTP — not an alternative product that requires a separate account or a crypto-native workflow. This is what it looks like when we start treating stablecoins as money.

Skeptics have rightly pointed out that stablecoin adoption outside of cross-border payments has been slow to materialize. However, we're now seeing stablecoin availability expand from specialized cross-border payments providers to the cross-border use case within much larger platforms. Cross-border may be the most obvious use case, and one which users are motivated to self-educate and experiment. However, once stablecoins are on the platform, user awareness will grow and the companies will more easily expand the product into adjacent use cases. Think of cross-border as the springboard.

The competition isn't just to provide on-/off-ramps. Payoneer is filing to issue its own stablecoin. Modern Treasury is positioning itself between banks and their corporate clients. Meta could end up holding balances on behalf of millions of creators, and then billions of users. The entire payment relationship is up for competition at every layer. Banks that don't offer a stablecoin product aren't just losing a fee line — they're increasingly at risk of ceding the relationship itself.

Coupon Clippings

White House Yield Standoff: Progress Made, Phones Confiscated, No Deal

The latest White House roundtable on stablecoin yield ran so long that officials collected attendees' phones to keep them in the room. "Progress" was the word coming out, but no deal — and the March 1 deadline has passed. The sticking point is straightforward: banks want yield prohibited so stablecoins don't become a deposit substitute; the crypto industry wants it preserved so stablecoins can compete with money market funds. The OCC's proposed rules landed squarely on the banks' side with an explicit yield prohibition, but that fight is far from over. The comment period will tell us a lot about where this ends up. [Full Story]

Stablecoin Users Want Bank-Issued Wallets

A YouGov survey commissioned by Coinbase and BVNK found that 67% of current stablecoin users in high income economies (US/Europe/Australia) would open a stablecoin wallet with their bank. While I am generally skeptical of any survey questions that envision hypotheticals, the strong response here is worth noting and speaks to the degree that stablecoin users are still fiat users and banks have an opportunity to leverage their trust and services to attract this demographic. Banks think that stablecoins can trigger a deposit flight, but this survey suggests the exact opposite may be true. [Full Story]

The OCC's 376-Page Rulebook Has Arrived — Full Analysis Coming

The OCC released its proposed GENIUS Act rulemaking on February 25: reserve requirements anchored to high-quality liquid assets, a $5 million minimum capital floor for new issuers, a 2-business-day redemption standard, and an explicit prohibition on yield payments by stablecoin issuers. The 60-day comment period is genuinely consequential in both directions — the final rule could move meaningfully on the yield question and on variable capital requirements. Full analysis — issuer profitability math, the liquidity waterfall design, and yield prohibition workarounds — is forthcoming in a dedicated special edition. [Full Story]