By Stacker
- Goldman Sachs, Bank of America and Citigroup among other banks are jointly exploring stablecoins tied to major national currencies as they look for ways to efficiently move money faster
- Stablecoin transaction volumes reached about $33T last year
If you’ve ever sent money through Western Union, paid with a Visa card while traveling, or waited days for an electronic payment to settle, you’ve already used the systems known as “payment rails” that move money globally between friends, families and businesses. Now, banks and payment companies are testing how cryptocurrency technologies might speed up those systems and help people process and reconcile payments more efficiently. One of those tools is the stablecoin, a type of digital token designed to hold a consistent value.
Why This Matters: Stablecoins are most often pegged to the U.S. dollar (USD), but they can also be backed by other currencies, including fiat (government-issued) money and crypto. Unlike other cryptocurrencies that can rise and fall sharply in price, USD-backed stablecoins are intended to remain, like their name suggests, predictable. As such, they’re designed for everyday transactions rather than trading and investing.
Interest in stablecoin technology has grown steadily over the past seven months, alongside clearer regulation. In July 2025, President Donald Trump signed the GENIUS Act into law, which created a federal framework for certain dollar-backed digital crypto tokens. Regulators then opened 2026 by advancing proposals on crypto market regulation and mulling over questions such as which regulatory body should oversee digital assets and how dollar-backed stablecoins could be used inside the banking system.
That regulatory momentum has made banks more willing to test the technology at scale, increasing the likelihood you’ll soon see stablecoins as an option at some checkouts. According to Bloomberg, stablecoin transaction volumes reached about $33 trillion in 2025, up from $19.7 trillion a year earlier, and the World Economic Forum predicts that 2026 will be a “defining moment” for crypto technologies.
What Is A Stablecoin?
A stablecoin is a digital crypto token that represents a fixed amount of currency, most often one USD. Each token is designed to track that value consistently because it’s backed by an equal amount of reserves held by the issuer, or the organization that creates and manages the stablecoin.
Stablecoins can be issued by banks, government-related entities, or private companies. The stablecoin issuer decides how many of the crypto coins will exist and holds the money or assets that back each token. Different issuers operate under different levels of oversight, and the rules for each are still being defined by lawmakers.
This is the most common (and easiest to understand) kind of stablecoin. Each digital dollar is backed by real money or government assets, such as USD or Treasury bonds, held by the company or bank that issued it. The idea is that for every digital dollar in circulation, there is a real dollar or something very close to it set aside.
Similar stablecoins also exist for other currencies, too, such as the euro (EUR). Fiat-backed stablecoins are the type most often used by banks, payment companies, government-related projects, and everyday consumers.
What’s Next: For most consumers, stablecoins are not expected to replace cash, credit cards, or bank accounts outright. Instead, banks, payment companies and online businesses are beginning to offer dollar-linked digital tokens as an additional way to pay for more flexibility. Stablecoins are already used in some online shopping checkouts, money transfer apps and cryptocurrency platforms, and they can sometimes settle faster and with lower fees than traditional payment rails.
Finally, major banks including Bank of America, Citigroup, Goldman Sachs, Deutsche Bank, UBS, Barclays, Banco Santander, BNP Paribas, MUFG and TD Bank Group have said they are jointly exploring stablecoins tied to major national currencies such as the U.S. dollar, euro and Japanese yen, as they look for ways to move money faster using the underlying technology in a compliant way.
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