It’s ‘Crypto Week’ in the US and major banks are preparing for a race to the stablecoin market.
Citigroup will explore the issuance of a native stablecoin and tokenised deposits, the bank’s CEO Jane Fraser confirmed during an earnings call on July 15.
Fraser explained that while its potential tokenised deposits may take priority, she revealed Citibank still has the intention of exploring the issuance of a “Citi stablecoin”.
The Citigroup CEO also highlighted the bank could venture into the world of cryptocurrencies in the form of custody service offerings, as well as opening a service for the management of stablecoin reserves.
Fraser made comments to members of the media during Citigroups’ second-quarter earnings call which saw the US bank’s profits increase by 25%, investment banking rising by 13%, and stocks reaching its highest levels since the 2008 financial crisis.
Looking ahead to the future, Citigroup is taking significant interest in the tokenised deposits market which could facilitate any potential USD-backed stablecoin from the bank. Fraser revealed the four key components Citigroup is currently exploring; reserve management for stablecoins, on-and-off ramps for cash, a native stablecoin and tokenised deposits.
In response to a question regarding the potential of stablecoin’s for cross-border payments, Fraser noted just 6% of stablecoin transactions are settled in a traditional sense and 7% of these transactions incur a hefty charge.
“This is where Citi Token Services is so exciting because it enables the client to move from physical fiat to the digital and back again without incurring that transaction cost,” explained Fraser.
She further explained how the use cases for stablecoin cross-border settlement could help clients instantly send fiat-to-stablecoin, and vice-versa, globally 24/7 through a service that Citi handles “complexities” such as AML and accounting.
This on-and-off ramp process could enable clients and US banks to access on-chain markets to send and receive funds with various digital currencies with instant settlement.
It’s “crypto week” in the US
Citigroup, like its competitors J.P. Morgan and Bank of America, are increasingly looking at stablecoins as interest from the traditional finance sector has surged in the last year. This is backed by cross-border payment use cases and perhaps more importantly, developing regulatory frameworks.
Fraser cited the impending vote on the GENIUS Act, which is expected to be held on July 16 in the House of Representatives.
“We really welcome the administration’s willingness to allow banks to participate in the digital asset space more easily,” said Fraser.
The GENIUS Act, which looks to implement a regulatory framework for rules surrounding the issuance and usage of USD-backed stablecoins, is set for another vote after representatives from the White House rejected to advance the bill. The GENIUS Act was passed in the Senate in June 2025.
In a statement titled ‘House Announces Week of July 14th as “Crypto Week”’, House of Representatives speaker Mike Johnson said: “House Republicans are taking decisive steps to deliver the full scope of President Trump’s digital assets and cryptocurrency agenda. I look forward to President Trump signing them into law.”
Some of the proposed guidelines for certain stablecoin issuers within the GENIUS Act include state-qualified issuers if they meet federal equivalency standards, subsidiaries of insured depository institutions, and non-bank entities to be approved by a federal regulator.
This surge in interest in stablecoins from US banks like Citigroup, Bank of America and J.P. Morgan is further fuelled by the leniency and advantage they have over private issuers like Circle and Tether to meet regulatory requirements.
