Goldman Sachs, BofA among nine major Wall Street banks launch G7 currency-linked stablecoin project

Global major banks are launching a joint project to jointly develop stablecoins linked to G7 (Group of Seven) currencies. Traditional finance is formally entering the blockchain-based payments market, putting forward the idea of 'proprietary digital currencies' to compete with existing crypto payment infrastructure.

On the 11th, The Economist reported that the consortium includes Goldman Sachs(Goldman Sachs), Deutsche Bank(Deutsche Bank), Bank of America(Bank of America), Santander(Santander), BNP Paribas(BNP Paribas), Citigroup(Citigroup), MUFG Bank(MUFG Bank), TD Bank Group(TD Bank Group), UBS and nine major global banks. Each bank is discussing issuing blockchain-based digital assets that are backed 1:1 by fiat currency reserves, and they plan to operate on a public network.

A consortium spokesperson said, "Preliminary consultations with national regulators and supervisory authorities are already underway, and we are reviewing whether this project can improve the competitive landscape of the global digital payments market."

This joint project is part of Wall Street's expansion of digital currencies following JP Morgan's deposit-backed 'JPMD token' and BNY Mellon’s tokenized deposit experiments. HSBC, SWIFT and others are also already testing tokenized payment and clearing systems, and in Europe ING, UniCredit, Deutsche Bank and six other banks plan to jointly issue a euro stablecoin under MiCA regulation.

Meanwhile, this move by traditional finance is interpreted as a response to concerns about 'deposit outflows' caused by the spread of stablecoins. Earlier, Standard Chartered warned that by 2028 more than $1 trillion of emerging market bank deposits could flow into stablecoins.