"Banks want in on Tether’s billions in stablecoin profits"

Banks, long envious of Tether Holdings' billions in profits from stablecoins, are now jumping into the market themselves.

This year, Societe Generale - Forge (SG-Forge) made its euro-backed stablecoin, essentially a blockchain-based representation of fiat currency, available to retail investors. Other financial institutions are following suit. Oddo BHF SCA is developing a euro-denominated stablecoin, while London-based Revolut is exploring its own version. AllUnity, a venture tied to Deutsche Bank-owned DWS, plans to release a stablecoin next year, and BBVA is working on its entry.

In the U.S., banks are expected to join the trend once legislation enabling them to issue stablecoins is enacted. In Europe, the Markets in Crypto-Assets Regulation (MICA) has clarified the regulatory landscape. Additionally, Tether's discontinuation of its EURt stablecoin has created an opening for new players aiming to offer fiat-like alternatives for payments and holdings.

"Do I think other banks will issue their own stablecoins? The answer is yes," said Jean-Marc Stenger, CEO of SG-Forge, in an interview. "It’s a heavy lift, and I’m not sure it will happen quickly, but it will happen."

SG-Forge is already engaging with several banks interested in using its stablecoin or licensing its technology to issue their own. Stenger revealed that discussions are ongoing with about ten institutions for partnerships or white-labeling agreements.

Visa Inc. is also making moves in the stablecoin space. In October, Visa launched a tokenization network enabling banks to issue stablecoins and is piloting a project with BBVA set to launch in 2025. Cuy Sheffield, Visa’s head of crypto, noted significant interest: "We’ve seen demand from banks in Hong Kong, Singapore, and Brazil. We are actively engaged with numerous banks worldwide at different stages of the process."

Standard Chartered is another player pushing forward. Partnering with blockchain gaming company Animoca Brands Ltd. and Hong Kong Telecommunications Ltd., the bank was chosen by the Hong Kong Monetary Authority to pilot an HKD-denominated stablecoin in an experimental program. According to Rene Michau, Standard Chartered’s global head of digital assets, the stablecoin could go live as early as 2025.