Citigroup is considering issuing its own Stablecoin for cross-border payments
Citigroup is exploring the possibility of issuing #stablecoin specifically for cross-border payments, CEO Jane Fraser revealed during this week's earnings report call. This move places Citi on the growing list of major banks considering stablecoin initiatives, highlighting the interest of traditional finance (TradFi) in a space once solely occupied by pure crypto firms.
Enhancing services and competitive advantages
Jane Fraser stated that #CitiGroup is looking into "issuing a Citi stablecoin," as well as "managing reserves for the stablecoin, entry and exit points from cash to coin and vice versa." Citi has previously discussed with JPMorgan Chase, Bank of America, and Wells Fargo about jointly issuing a stablecoin pegged to the dollar. Entering the stablecoin market aims to enhance revenue and compete with issuers like Circle, especially as the new U.S. regulatory framework for stablecoins is expected to take effect this year.
Citi is currently handling $5 trillion in cross-border transactions daily. The bank has also launched Citi Token Services, a real-time encrypted deposit platform for cross-border payments and automated trade finance solutions, in four markets. Fraser emphasized that the cost of transferring money using stablecoins can be as high as 7%, a "forbidden" level, and developing its own stablecoin would help reduce these costs, providing a competitive advantage over existing crypto solutions.