When Standard Chartered (STAN) said it would offer institutional clients direct access to minting and redeeming Circle Internet's (CRCL) $USDC this week, it wasn't simply adding another digital asset service.
Rather, it was joining a growing list of global financial institutions building product offerings around stablecoins, the fiat-pegged tokens that were once retail investors' refuge from crypto-market volatility and are increasingly becoming part of the plumbing of financial institutions worldwide. Chainalysis estimates stablecoin settlement volumes could reach a quadrillion dollars a year by 2030.
Standard Chartered’s announcement came just days after BNY, the world's largest custody bank, expanded its support for $USDC by allowing institutional clients to custody, mint and redeem the stablecoin using its infrastructure rather than building their own. Both Standard Chartered and BNY, which has $59 trillion in assets under management, are considered global systemically important banks by the Bank for International Settlements' Basel Committee.
Their decisions reflect a pattern among some lenders toward using established stablecoin networks rather than creating their own. The moves also suggest the conversation inside banking has shifted. The question is no longer whether stablecoins belong in finance, but how banks fit into the networks forming around them.
"Banks aren't asking whether they'll use stablecoins anymore. They're deciding how they'll use them," said Andrew MacKenzie, the founder and CEO of Scotland-based stablecoin issuer Agant, in an interview.
The discussion intensified this week after Circle CEO Jeremy Allaire responded to the introduction of OpenUSD, a rival stablecoin backed by companies including Coinbase (COIN), payments company Stripe and asset manager BlackRock (BLK). Allaire said $USDC's position rests on nearly a decade of building liquidity, banking relationships and regulatory approvals.
Adrian Cachinero Vasiljevic, a co-founder and partner at Steakhouse Financial, which advises institutions on decentralized finance, agrees that the surrounding ecosystem is key.
"The network is what creates the value," he said in an interview. "The stablecoin itself becomes almost secondary.
Read more: Circle’s $USDC Overtakes Tether's USDT in Onchain Activity as Regulation Drives Shift: JPMorgan
Even so, new stablecoins continue to appear, especially in Europe where there's less of an established network and there's concern about the preponderance of dollar-pegged tokens, which account for more than 99% of the total stablecoin market cap.
Jan-Oliver Sell, CEO of Qivalis, a group of 37 European financial institutions developing the Euro On-Chain (EUOC) stablecoin, noted that Europe already has regulatory oversight under the Markets in Crypto-Assets (MiCA) framework. What it lacks is enough euro-denominated liquidity to keep settlement activity from migrating to dollar-backed stablecoins.