December 1st, 2025

Four stablecoin developments bankers should know about

Welcome to the latest edition of The Stablecoin Banker, a periodic newsletter 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 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.

In This Issue

• A Watershed Moment: Cross River Builds Stablecoins Into the Banking Core
• The FDIC Sets the Table: Three Paths to On-Chain Banking
• Fintechs Build the Stablecoin Acceptance Layer—Around Banks, Not Through Them
• Figure Unlocks US Tokenized Stocks: The First Blockchain-Native Public Equity

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

A Watershed Moment

Cross River Bank announced the launch of stablecoin pay-in/pay-out through its deposit accounts, with stablecoins now integrated directly in its core. The offering unifies fiat and stablecoin flows through a single interoperable system, enabling companies to move value across blockchain networks and traditional rails while maintaining bank-grade compliance. The bank positions the product for fintechs, enterprises, and crypto-native companies seeking infrastructure for network settlement, merchant payouts, on/off ramps, and treasury management. Cross River's CEO states that the bank is "reimagining every corner of banking" to deliver on-chain financial infrastructure. [Source: BusinessWire]

My Take:

This isn't a crypto custody announcement or a tokenization pilot. Cross River has done something far more significant: they've built stablecoin fluency directly into their banking core. What this means is that a CRB customer can use the same deposit balance to move money as digital bank dollars (ACH, wire) or stablecoin. Fundamentally, the bank is saying that when it comes to interacting with a deposit account, they are agnostic to whether value arrives as fiat or stablecoin.

I call this a watershed moment because it’s the first time a US regulated bank is directly integrating the core customer deposit account on-chain. I have been waiting years for this moment: last year, I envisioned this exact use case for Omnia, and before that entertained similar concepts for my first startup building a bank-issued stablecoin. Cross River has collapsed a complex and inefficient stack of services used by fintechs to offer stablecoins to users: a BaaS relationship, separate pools of fiat and stablecoin liquidity, MTL and compliance tools, and wallets.

Any bank looking at stablecoin use cases should be thinking similarly because any other approach is inefficient and now looks antiquated. The approach of using third party stablecoin issuers or fintechs to provide stablecoin liquidity requires multi-party relationships, inefficient pre-funding, and accepting higher compliance risk. Another approach of custodying stablecoin for the bank customer breaks fractional-reserve banking. CRBs approach converts a stablecoin into a traditional deposit on the fly, allowing CRB to liquidate the stablecoin and lend the fiat like a normal bank. The right approach is to build it into the bank (Omnia can help you with that!).

FDIC Sets the Table

Acting FDIC Chair Travis Hill announced the agency is preparing guidance on how deposit insurance applies to tokenized deposits and will introduce a formal application process for stablecoin issuers by year-end. On tokenized deposits, Hill's position is: "A deposit is a deposit. Moving a deposit from a traditional-finance world to a blockchain shouldn't change the legal nature of it." On stablecoins, the FDIC is developing standards around capital, reserves, and risk management under its GENIUS Act responsibilities. Meanwhile, U.S. Bancorp—the fifth largest U.S. bank with $671 billion in assets—announced it is testing custom stablecoin issuance on the Stellar network. [Sources: Yahoo, Stellar]

My Take:

The FDIC is building a menu of options for banks that want to move value on-chain. Path one: issue a stablecoin under GENIUS Act, with applications opening by year-end. Path two: tokenize existing deposits with full FDIC insurance treatment. Path three, suggested by Cross River's announcement last week, but not yet on the FDIC roadmap: make your core stablecoin-fluent so the deposit account itself becomes the interface to blockchain rails.

Each path involves real tradeoffs. Stablecoin issuance lets you capture reserve yield but requires dedicated effort to build distribution and might move deposits into lower-yielding stablecoin reserve assets. Tokenized deposits preserve your existing customer relationships, FDIC coverage, and lending capacity while adding on-chain settlement efficiency, but they're best suited for institutional and interbank flows where counterparty exposure is already the norm. The Cross River model keeps deposits fungible and lendable, but requires deeper core integration than most banks can execute quickly (though Omnia can help with that!).

U.S. Bank's decision to test stablecoin issuance now—before the application window opens—illustrates the strategic logic at work. I suspect they're building operational capability so they can move the moment the door opens, not months after. JP Morgan has already gone live with deposit tokens, and there are multiple projects in flight to build deposit token networks, all before regulators have promulgated a roadmap.

Now that we see a few distinct paths emerging, banks can more easily distinguish between options. The difference is in which path fits a bank’s deposit franchise, customer base, and  appetite for integration complexity.

Fintechs Build the Stablecoin Acceptance Layer

Three major fintechs announced stablecoin payment initiatives within two weeks, each deploying the same playbook: accept fiat on one side, deliver stablecoins on the other. Visa launched a pilot through Visa Direct allowing businesses to fund payouts in fiat while recipients—creators, freelancers, and gig workers—receive USDC directly in crypto wallets. Cash App announced USDC support on Solana for early 2026, assigning each of its 57 million users a blockchain address with automatic fiat-stablecoin conversion. Klarna, with stated intentions of becoming a neobank, unveiled KlarnaUSD built on Stripe's new Tempo blockchain using Bridge infrastructure—targeting the $120 billion cross-border payment fee market. [Sources: CashApp, Visa, Klarna, PYMNTS]

My Take:

Remember the early days of tap-to-pay? Half the terminals didn't support NFC, most phones lacked the chips, and nobody knew which merchants would accept it. Apple, Google, and the card networks kept pushing anyway—embedding the capability everywhere until the infrastructure became ubiquitous. We're watching the same playbook unfold with stablecoins being woven into the wallet side and the merchant side throughout the global fintech layer.

Visa, Cash App, and Klarna have each arrived at the same solution to the classic two-sided market problem: don't wait for both sides to adopt stablecoins simultaneously. Instead, become bilingual—absorb the conversion friction yourself, accept fiat from one party and deliver stablecoins to the other.

This matters because these companies are building the acceptance network around banks, not through them. Visa Direct delivers USDC directly to wallets, bypassing bank accounts entirely for certain payee segments. Cash App's 57 million users will get blockchain addresses that auto-convert between fiat and stablecoins. Klarna is targeting the $120 billion cross-border fee pool that banks have long treated as reliable revenue.

Banks can play in this space too, by powering conversions, stablecoin-to-fiat payments, yield, and lending products - the roadmap that Cross River has outlined. BaaS banks will need to move quickly now, and retail and commercial banks will follow as fintechs build out  compelling products that attract traditional banking customers.

Figure Unlocks US Tokenized Stocks

Figure Technology Solutions filed an S-1 registration for what it describes as the first blockchain-native public equity offering in the United States. The "Series A Blockchain Common Stock" will exist natively on the Provenance Blockchain, trade exclusively on Figure's SEC-registered Alternative Trading System, and settle atomically using YLDS—an SEC-registered yield-bearing tokenized money market fund issued by Figure's subsidiary. The structure enables 24/7 trading and eliminates traditional clearing infrastructure. Each blockchain share is convertible 1:1 into Figure's existing Class A Common Stock, creating a bridge between the on-chain and traditional markets. Figure also announced that its "Democratized Prime" protocol will provide on-chain borrowing and lending against the tokenized securities. [Sources: Figure]

My Take:

I’ve written about how tokenization will enable banks to much more easily offer trading services and create totally new products, but the missing piece has been a US-compliant equity tokenization solution that can bypass traditional trading and settlement infrastructure. Figure’s solution will allow US investors to trade a registered security natively on-chain, while accessing leverage through a decentralized borrow/lend marketplace.

Today, executing a stock trade requires a daisy chain of intermediaries. Figure's approach eliminates: T+1 settlement windows, DTCC margin requirements, custodian chains, proxy voting intermediaries, and prime broker lending opacity.

The main tradeoff? Fragmented liquidity. The Blockchain Stock trades exclusively on Figure's ATS—a regulatory requirement—siloed from NASDAQ's deep pools. Their solution is to design the token like a stablecoin by making each token convertible on a 1:1 basis to Figure's NASDAQ-traded common stock, creating a built-in arbitrage mechanism that attracts liquidity.

Why should banks care? Securities lending becomes a 24/7 on-chain business in which banks can easily participate (useful for banks supporting real time payments because they can liquidate loans quickly). Banks can also offer customers access to tokenized securities through bank-provided wallets where customers execute directly on the ATS. New features, new revenue, no new license.

Coupon Clippings

LevelField Acquires Burling Bank

LevelField Financial received conditional approval from Illinois regulators to acquire Chicago-based Burling Bank for approximately $70 million, putting it one step closer to becoming the first full-service FDIC-insured bank offering integrated digital asset services nationwide—pending Federal Reserve sign-off. The firm plans to offer Bitcoin-collateralized loans, crypto custody and trading, and Bitcoin rewards cards alongside traditional deposit accounts. This puts LevelField in the same category as Erebor, which received conditional OCC approval for a de novo charter with a very similar business plan in October. The strategy is more aggressive than Circle, Ripple, and others, which are pursuing non-depository trust charters. CEO Gene Grant's reasoning is: "Financial services must be changed from the inside—unlike other industries, outside disruptors barely move the needle." For banks watching the charter gold rush unfold, LevelField's approach is a reminder that the competitive threat isn't limited to narrow-purpose trust charters—some crypto firms are coming for the full banking license. [Full Story]

Coming to iOS: 9% on Cash with $1M Insurance

DeFi lending giant Aave launched a consumer savings app offering up to 9% APY, $1 million in balance protection (four times FDIC limits), and connections to over 12,000 banks and cards for fiat deposits—all wrapped in a neobank-style interface that abstracts away every trace of crypto complexity. The app lets users deposit euros or dollars directly from bank accounts while the protocol automatically deploys those funds in overcollateralized loans. With $56 billion in deposits, Aave is no longer pitching DeFi to crypto natives—it's pitching a savings account to bank customers. The strategic shift here matters: DeFi's historical barriers to mainstream adoption were complexity, trust, and fiat access. Aave just took a huge step forward on all three. The "DeFi is too risky and complicated" defense is starting to evaporate. If the app is successful, it will be a prime example of what "unbundling the bank" looks like when it reaches the retail savings product. [Full Story]

“Crypto is finally at a stage where it is fast, low-cost, secure, and built for scale. This is the beginning of Klarna in crypto.” - Sebastian Siemiatkowski, co-founder and CEO of Klarna (another reformed crypto skeptic), November 25, 2025.

Omnia is a provider of stablecoin infrastructure for banks that want to capture growing demand for stablecoins. If you’re interested in learning more about us, please get in touch.