Citigroup to join banking coalition developing euro stablecoin.

Stablecoins — tokens designed to maintain a constant value against a traditional asset like the dollar — have surged in popularity over the past year as banks and other large financial firms see them as viable alternative payments methods. They could be used for more than US$50 trillion (RM211.25 trillion) in annual payments by 2030, Bloomberg Intelligence estimated. That would see the fiat-pegged tokens capture as much as 25% of consumer transactions, up from less than 1% now.

New stablecoins rules in Europe and the US have provided more regulatory clarity needed for large firms to enter the space, spurring a flurry of recent activity.

A group of banks including Citigroup, Goldman Sachs Group Inc and Bank of America Corp said earlier on Friday that they were joining forces to explore a stablecoin-like form of digital money.  Earlier this week Citi’s venture arm made an investment in stablecoin infrastructure company BVNK. In July, Citigroup chief executive officer Jane Fraser said on an earnings conference call that the bank was considering issuing its own stablecoin.

While the total amount of stablecoins in circulation has reached around US$300 billion, the market is overwhelmingly dominated by dollar-denominated coins. Only about US$477 million euro-tied coins are in circulation, according to crypto data tracker DefiLlama.

Source: Theedgemalaysia