How Are Banks, Card Networks, and Payment Processors Adapting to Stablecoins?

Wall Street, meet stablecoins: Banks and payment giants are racing to find their place in the new financial landscape.

By Jack Caporal – Updated Jul 24, 2025 at 3:43PM

Key Points

Major banks are considering issuing their own stablecoins or tokenized deposits.
Visa and Mastercard are integrating stablecoins with traditional payments.
The Genius Act regulates stablecoin reserves and opens issuance to nonbanks.
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While Circle’s (NYSE:CRCL) USDC (CRYPTO:USDC) and Tether’s USDT (CRYPTO:USDT) are currently the largest stablecoins, some of the biggest banks have signaled that they want to get in on the cryptocurrency action too. JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC), Citigroup (NYSE:C), and Wells Fargo (NYSE:WFC), among others, have reportedly had early conversations about issuing a joint stablecoin, which would radically reshape this emerging asset class.

Many of those banks are also considering launching their own stablecoins or deposit tokens, which function similarly.

They’re not alone. Payment processors, which could lose out on valuable fees if transactions shift away from their networks to stablecoins, are also looking at how to stay indispensable if stablecoins take off.

Here’s how banks, card networks, and payment processors are responding to the rise of stablecoins.

Banks and financial institutions

Some of the largest banks have discussed plans to issue stablecoins or tokenized deposit systems. There are also media reports of early-stage discussions about a stablecoin issued jointly by a group of banks.

JPMorgan Chase

JPMorgan Chase launched JPM Coin, a stablecoin, in 2019. It was launched with three use cases: to settle international payments among corporate clients, for institutional investors to instantly settle securities transactions, and as an alternative for corporations that use JPMorgan’s treasury services.

In 2025, JPMorgan announced plans for a deposit token similar to a stablecoin called JPMD. The token will operate on the Base blockchain and be available only to institutional clients. It will allow for 24/7 settlement and can be used for interest payments. JPMorgan claims that JPMD can be considered as bank deposits on balance sheets, which could be beneficial for clients.

Citigroup

Citigroup currently offers a token service for institutional clients called Citi Token Services. Deposits are translated into digital tokens on blockchain, which enable instant cross-border transactions at any time. In July, Citigroup CEO Jane Fraser said she hopes to make the company’s digital-asset capabilities “consumer- and client-facing.”

Fraser also said the bank is exploring a “Citi stablecoin.”

Bank of America

Bank of America is actively exploring launching a stablecoin but is waiting for clearer regulation and high customer demand, according to numerous statements from CEO Brian Moynihan in 2025.

Card networks and payment processors

Card networks, like Visa (NYSE:V) and Mastercard (NYSE:MA), have announced products and services that would maintain their positions as key parts of financial plumbing, linking partner-led stablecoin payments with fiat settlement.

Visa

Visa announced in April 2025 that it would accept stablecoins through partners like Bridge, a stablecoin platform owned by Stripe, letting customers link Visa cards to stablecoin wallets. When used at a Visa-accepting merchant, stablecoins are converted to fiat at checkout, so merchants are paid in the local currency. Visa acts as a bridge between stablecoins and fiat currency, not as a stablecoin-native network, and merchants don’t receive crypto through this system.

Mastercard

Mastercard enables stablecoins in its network through integrations with partners including Paxos, Circle, Fiserv, and PayPal. Mastercard provides wallet-linked cards through crypto platforms like MetaMask, Kraken, and Binance and is eyeing merchant settlement in stablecoins. It seeks to bridge stablecoin usage and the traditional financial system.

PayPal

PayPal (NASDAQ:PYPL) has launched PayPal USD (CRYPTO:PYUSD), a dollar-backed stablecoin available to U.S. PayPal users. PYUSD is issued by Paxos on Ethereum and Solana and can be bought, sold, and transferred through PayPal. It can be sent domestically with no fees or withdrawn to external wallets, with a network fee. PYUSD can be used at checkout, where PayPal converts it to fiat.

Stablecoins after the Genius Act

Banks waiting on a clearer regulatory landscape before formalizing their plans for stablecoins might have just had their wishes granted. On July 17, 2025, Congress passed the so-called Genius Act to regulate stablecoins, bringing some long-sought legitimacy to the crypto industry.

The bill includes a requirement that issuers of dollar-backed stablecoins hold dollar-for-dollar reserves in permitted products, including insured deposits at banks, short-term Treasury bills, repos, and other government-issued assets. The bill also requires regulations to be promulgated for stablecoin issuers but exempts issuers from capital standards that traditional banks must meet. Stablecoin issuers will also be required to maintain redemption procedures and report on reserves, which would be audited by accounting firms.

Notably, the Genius Act allows both banks and nonbanks to issue stablecoins. The latter would require approval from the Treasury Secretary and the chairs of the Federal Reserve and the Federal Deposit Insurance Corporation. But the legislation opens the door to companies issuing their own stablecoins – which Walmart (NYSE:WMT) and Amazon (NASDAQ:AMZN) are reportedly exploring.

Proponents of the Genius Act say it will help bridge traditional and decentralized finance, improve the payments system, and strengthen the dominance of the dollar. Critics warn that the legislation will give the industry a veneer of legitimacy and oversight without requiring tough enough regulation to protect consumers. Detractors also claim that the bill does not do enough to prevent stablecoins from being used for corrupt purposes.