MW Are stablecoins the next Venmo? Big banks prep for the next big payments competition.

By Steve Gelsi

Just as banks launched Zelle to take on Venmo, they've started diving into stablecoins to fend off competition, which could intensify after passage of the Genius Act

Big banks could team up as part of an "all of the above" approach to compete in the growing world of stablecoin payments, just as they did when faced with a challenge from payment app Venmo.

That competition will likely step up, after the House of Representatives on Thursday passed the Genius Act to regulate stablecoins. The Senate had done the same in June.

While the battle is heating up for the banks, any transition to a stablecoin world would likely be seamless for consumers.

Read more: Genius Act ushers in a new era for stablecoins. Here's what that means for Americans' wallets.

Asked if banks will create a consortium, like Zelle, on stablecoins for the industry to defend against a rival stablecoin payment service, or just launch products on their own, Bank of America Chief Executive Brian T. Moynihan said both approaches could be needed - "I think it would be all of the above," he said.

"We already have partnerships with some of them," Moynihan said. "And so, it will be a complex array and hopefully not complex to the customer, frankly."

Banks may offer individual stablecoin products for their commercial customers, but the broader business will rely on building networks with other groups, including stablecoin companies, he said.

"We'll be there just like we were there when we moved from checks to Zelle," Moynihan said. "We can move money efficiently, and we have to be aware of the attack on the payment system and we'll be there to defend it."

Moynihan's comments on the competition and opportunity offered by stablecoins were mostly reinforced by the CEOs of the top U.S. banks, including Goldman Sachs Group Inc. (GS), Citigroup Inc. (C) and JPMorgan Chase & Co. (JPM), in response to questions from analysts on the topic this week.

Also read: Bitcoin briefly eclipses $123,000 as 'crypto week' kicks off on Capitol Hill

"At the end of the day, the debate will be how big an item this will be and how much more an effective payment stream it is," Moynihan said. "And there's places - like small-balance transfers across borders - that you can see the case. You can see it with sort of smart contracts and money movement. You can see it in digital-native apps, in-app payments and stuff."

Wall Street has already shown it's taking stablecoins seriously with the huge advance in the shares of stablecoin issuer Circle Internet Group Inc. $(CRCL.UK)$, which went public in June. And keep in mind that the lead underwriters of Circle's initial public offering included JPMorgan, Citigroup and Goldman Sachs.

Analysts have already been weighing the impact of stablecoins on banks, with some pointing out that they could sap bank profits over time.

Stablecoins are a type of digital money backed by state-issued bonds or currency, so as to make them less volatile, unlike other forms of cryptocurrency. They offer the potential to speed up cross-border transactions and to settle transactions on evenings and weekends.

Citigroup (C) CEO Jane Fraser said the bank has been investing in technology and new digital-currency products such as its Citi Token Services, which uses blockchain technology for around-the-clock cross-border fund transfers in near real-time.

"We aim to deliver the benefits of advancements in stablecoin and digital assets to our clients in a safe and sound manner by modernizing our own infrastructure and improving efficiency, transparency and interoperability for our clients," Fraser said. "We are laser-focused on innovations which enable clients to access real-time 24/7 payments, clearing and settlement across borders and across currencies."

Sharon Yeshaya, financial chief of Morgan Stanley (MS), said the firm is looking at stablecoin for its client base, but it's still early days, with no regulations yet in place.

"We're very, very close to the landscape," Yeshaya said. "We're understanding this, as well as the evolution across all technological advancements. AI, crypto, you name it, all of them sort of have an ecosystem that we're very focused on."

Goldman Sachs (GS) CEO David Solomon said stablecoins fit into the larger move toward digitization of currencies around the world, but it's too early to say how the bank will deploy its capital in the space.

"There are a handful of places where there could be interesting opportunity for us potentially around funding," Solomon said. "We also think that the continued digitization of the financial system takes friction out and creates new opportunities."

JPMorgan Chase & Co. (JPM) CEO Jamie Dimon said the JPMorgan deposit token "is essentially the same thing" as a stablecoin. While he's been a well-known crypto skeptic, he recognizes the bank has to take competition from stablecoins seriously.

"We're going to be involved in both JPMorgan deposit coin and stablecoins to understand it, to be good at it," Dimon said. "I think they're real, but I don't know why you'd want a stablecoin as opposed to just payment."

At the same time, fintech entrepreneurs "are very smart" as they try to find ways to create bank accounts and get into payment systems and rewards programs.

"We have to be cognizant of that," Dimon said. "The way to be cognizant is to be involved."

Bank of America, PNC Financial Services Group Inc. $(PNC.AU)$, $Capital One Financial Corp(COF-N)$. $(COF)$, Truist Financial Corp. (TFC), Wells Fargo & Co., U.S. Bancorp (USB) and JPMorgan Chase own Early Warnings Services LLC, which operates Zelle.

JPMorgan Chase's stock is up 20.9% in 2025, while Citigroup's stock has climbed 32.3%, Morgan Stanley shares have advanced by 12.1%, Goldman Sachs' stock rallied 23.4% and Bank of America's stock has gained 7%. Meanwhile, the S&P 500 index SPX has tacked on 7.1% this year.

-Steve Gelsi

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July 17, 2025 17:06 ET (21:06 GMT)

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