Goldman Sachs, Citigroup, Bank of America, UBS, Deutsche Bank, and Mitsubishi UFJ—this group of names gathered into the same announcement, saying they plan to co-found a company and issue a dollar stablecoin. In the past couple of days, most Chinese-language posts have stalled at translating the list of names and adding a line about traditional finance making a comeback. The roster is indeed impressive, but it doesn’t answer the more important question: once this money actually comes in, which side does this stablecoin business end up being passive on?
Let’s get the facts straight. A total of 21 institutions signed the letter of intent. In North America, there are also Wells Fargo, Toronto-Dominion (TD), Scotiabank, PNC, and First Capital, plus two asset managers, Fidelity and WisdomTree. Europe includes Santander, BBVA, Crédit Agricole, Lloyd’s, Rabobank, and Commerzbank. Africa is Standard Bank, and the Middle East is Sirius.
The company hasn’t been named and hasn’t been formally established yet. The announcement says it’s intended to be set up, and that delivery is subject to conditions. The entity plans to be built in the second half of this year, with the token targeted to launch in the first half of next year—starting with the dollar, and then expanding to the euro and other G7 currencies. Nothing has happened yet; they’ve simply written down when it will happen.
The issuer’s revenue comes only from the reserves side: collecting users’ dollars and buying short-term treasuries to earn interest. The hard part has always been the distribution side—how to get users to let their money sit in your coin instead of someone else’s. The GENIUS Act rewrites the relationship between the two ends: the issuer is not allowed to pay you, in any form, any interest or yield merely because you hold that stablecoin; cash, tokens, and other consideration are all included. Once this lands, the path of grabbing customers by offering higher yield is effectively sealed. If users hold anyone’s coin, the yield is zero. The only thing left to compare is who occupies the position where users keep their deposits.
Circle’s earnings report describes it more directly than any analysis. In Q2, its total revenue plus reserve income totaled $701 million, with reserve interest alone making up $668 million—so it claims the company has only one item of income, which isn’t an overstatement. In the same quarter, distribution and trading costs were $412 million, with the bulk paid to Coinbase. For every dollar Circle earns from reserve interest, more than half has to go to the party that helps it secure user custody. Since the law doesn’t let it pay users, it can only route the money through channels.
By the end of June, that group already moved with this logic. Stripe, Visa, Mastercard, Coinbase, BlackRock, and more than 140 other companies came together to form Open USD. The mechanism explicitly states that the vast majority of reserve earnings are returned to growth partners that help drive the platform’s growth, while it keeps only a small management fee. The payment Circle makes to Coinbase was directly turned into product design.
At this point, the banks’ targeted position becomes clear. They don’t need to win anyone on yield. They already sit in places like corporate accounts, cross-border settlement, and correspondent bank clearing. Customers’ dollars were already in their hands. #稳定币 is more like giving existing channels another layer of settlement rails—it isn’t about acquiring customers from scratch.
The rate side, on the other hand, is actually a tailwind. The federal funds rate is still above three percent, and in September’s meeting the market is even pricing in rate hikes. Every dollar sitting in reserves now earns more than at this time last year. The issuer’s trouble has never been the level of interest rates; it’s always been whether the money will stay with it.
USDT’s current circulating supply is roughly $183.3 billion, and over the past six months it’s been basically flat. $USDC is roughly $73.8 billion—back in March this year it was at higher levels, and then it shrank steadily, bottoming out in early August, only recently coming back a bit. In early August, Morgan Stanley downgraded Circle from Neutral to Underweight, cutting the target price to $38. The reason was how deeply USDC contraction exposes Circle’s reliance on reserve income.
My view is that the bank group’s move basically doesn’t overlap with USDT. USDT is positioned where emerging markets use it—using cash and doing over-the-counter settlement—supporting most of the exchange’s quotes. A bank coin, compliant-first and aimed at institutional wholesale settlement, cannot squeeze into these places in 2027. What’s being targeted is USDC. It competes with this bank coin for the same customer: institutional dollars within the U.S. regulatory framework. That customer cares about compliance and also about who holds the account—both are the bank’s home turf.
The most fragile part of this scenario is timing. The body only gets established in the second half of this year. The token has to wait until the first half of next year. Even the OCC implementation details are delayed until November for finalization, and after that there will be a rollout window. For a joint venture company formed by 21 shareholders, how slowly decisions get made is something anyone who has run cross-border projects knows well. If one shareholder drops out midstream or they revise the wording, the schedule gets pushed back—and in the meantime Circle can swap several rounds of channel partners.
It’s also possible I’ve got the direction backwards. If, at the end of the day, this coin is only used for wholesale settlement among banks and never truly issued to end users, then it wouldn’t overlap with USDC’s customers, and everything above would not hold. The announcement also mentions two use cases—wholesale transfers for institutions and retail payments. Which level they actually reach will only be known once the product comes out.
There’s one more variable on the rules side, and it favors banks. Banks are currently lobbying regulators to expand the interest-payment ban from issuers to affiliates and exchanges, closing the loophole that effectively routes interest back to users via channels. If this gets written into the final rules, the hardest hit would be the USDC incentive scheme Coinbase runs. But the bank group doesn’t rely on returning interest to acquire customers in the first place.
Over the next few months, this likely won’t leave much of a footprint in market pricing. Structural changes at the beginning are like this—if you really want to track it, watch USDC’s circulating supply. Circle’s own transparency page updates weekly; whether supply is shrinking or growing is more honest than any interpretation. As for the joint venture, you can see whether it truly gets registered by year-end, whether it has a name, and whether any shareholders exit along the way. The day the name is announced is when this goes from being a press release into a real company.
Let’s get the facts straight. A total of 21 institutions signed the letter of intent. In North America, there are also Wells Fargo, Toronto-Dominion (TD), Scotiabank, PNC, and First Capital, plus two asset managers, Fidelity and WisdomTree. Europe includes Santander, BBVA, Crédit Agricole, Lloyd’s, Rabobank, and Commerzbank. Africa is Standard Bank, and the Middle East is Sirius.
The company hasn’t been named and hasn’t been formally established yet. The announcement says it’s intended to be set up, and that delivery is subject to conditions. The entity plans to be built in the second half of this year, with the token targeted to launch in the first half of next year—starting with the dollar, and then expanding to the euro and other G7 currencies. Nothing has happened yet; they’ve simply written down when it will happen.
The issuer’s revenue comes only from the reserves side: collecting users’ dollars and buying short-term treasuries to earn interest. The hard part has always been the distribution side—how to get users to let their money sit in your coin instead of someone else’s. The GENIUS Act rewrites the relationship between the two ends: the issuer is not allowed to pay you, in any form, any interest or yield merely because you hold that stablecoin; cash, tokens, and other consideration are all included. Once this lands, the path of grabbing customers by offering higher yield is effectively sealed. If users hold anyone’s coin, the yield is zero. The only thing left to compare is who occupies the position where users keep their deposits.
Circle’s earnings report describes it more directly than any analysis. In Q2, its total revenue plus reserve income totaled $701 million, with reserve interest alone making up $668 million—so it claims the company has only one item of income, which isn’t an overstatement. In the same quarter, distribution and trading costs were $412 million, with the bulk paid to Coinbase. For every dollar Circle earns from reserve interest, more than half has to go to the party that helps it secure user custody. Since the law doesn’t let it pay users, it can only route the money through channels.
By the end of June, that group already moved with this logic. Stripe, Visa, Mastercard, Coinbase, BlackRock, and more than 140 other companies came together to form Open USD. The mechanism explicitly states that the vast majority of reserve earnings are returned to growth partners that help drive the platform’s growth, while it keeps only a small management fee. The payment Circle makes to Coinbase was directly turned into product design.
At this point, the banks’ targeted position becomes clear. They don’t need to win anyone on yield. They already sit in places like corporate accounts, cross-border settlement, and correspondent bank clearing. Customers’ dollars were already in their hands. #稳定币 is more like giving existing channels another layer of settlement rails—it isn’t about acquiring customers from scratch.
The rate side, on the other hand, is actually a tailwind. The federal funds rate is still above three percent, and in September’s meeting the market is even pricing in rate hikes. Every dollar sitting in reserves now earns more than at this time last year. The issuer’s trouble has never been the level of interest rates; it’s always been whether the money will stay with it.
USDT’s current circulating supply is roughly $183.3 billion, and over the past six months it’s been basically flat. $USDC is roughly $73.8 billion—back in March this year it was at higher levels, and then it shrank steadily, bottoming out in early August, only recently coming back a bit. In early August, Morgan Stanley downgraded Circle from Neutral to Underweight, cutting the target price to $38. The reason was how deeply USDC contraction exposes Circle’s reliance on reserve income.
My view is that the bank group’s move basically doesn’t overlap with USDT. USDT is positioned where emerging markets use it—using cash and doing over-the-counter settlement—supporting most of the exchange’s quotes. A bank coin, compliant-first and aimed at institutional wholesale settlement, cannot squeeze into these places in 2027. What’s being targeted is USDC. It competes with this bank coin for the same customer: institutional dollars within the U.S. regulatory framework. That customer cares about compliance and also about who holds the account—both are the bank’s home turf.
The most fragile part of this scenario is timing. The body only gets established in the second half of this year. The token has to wait until the first half of next year. Even the OCC implementation details are delayed until November for finalization, and after that there will be a rollout window. For a joint venture company formed by 21 shareholders, how slowly decisions get made is something anyone who has run cross-border projects knows well. If one shareholder drops out midstream or they revise the wording, the schedule gets pushed back—and in the meantime Circle can swap several rounds of channel partners.
It’s also possible I’ve got the direction backwards. If, at the end of the day, this coin is only used for wholesale settlement among banks and never truly issued to end users, then it wouldn’t overlap with USDC’s customers, and everything above would not hold. The announcement also mentions two use cases—wholesale transfers for institutions and retail payments. Which level they actually reach will only be known once the product comes out.
There’s one more variable on the rules side, and it favors banks. Banks are currently lobbying regulators to expand the interest-payment ban from issuers to affiliates and exchanges, closing the loophole that effectively routes interest back to users via channels. If this gets written into the final rules, the hardest hit would be the USDC incentive scheme Coinbase runs. But the bank group doesn’t rely on returning interest to acquire customers in the first place.
Over the next few months, this likely won’t leave much of a footprint in market pricing. Structural changes at the beginning are like this—if you really want to track it, watch USDC’s circulating supply. Circle’s own transparency page updates weekly; whether supply is shrinking or growing is more honest than any interpretation. As for the joint venture, you can see whether it truly gets registered by year-end, whether it has a name, and whether any shareholders exit along the way. The day the name is announced is when this goes from being a press release into a real company.