Global Banks Join Forces to Explore 1:1 Reserve-Backed Digital Currency

Some of the world’s largest financial institutions are collaborating on an initiative to issue a new form of digital money backed 1:1 by bank reserves and available on public blockchains. The effort marks a coordinated move by major banks to enter stablecoin markets at scale.

What’s the Scoop?

• Institutional Stablecoin Exploration: The group — including Banco Santander, Bank of America, Barclays, BNP Paribas, Citi, Deutsche Bank, Goldman Sachs, MUFG Bank Ltd, TD Bank Group, and UBS — is studying the feasibility of issuing a reserve-backed digital asset focused on G7 currencies.
• Regulatory Alignment: The banks said the project is designed to “enhance competition across the market while ensuring full compliance with regulatory requirements and best practice risk management,” positioning it as a compliant alternative to crypto-native stablecoins.
• Public Blockchain Ambition: The proposed digital reserves would exist on public blockchains, creating a transparent, interoperable settlement layer for institutional and retail transactions alike.
• Market Context: The global stablecoin market, currently led by Circle’s USDC and Tether’s USDT, sits near $290 billion in circulating supply. The recently adopted GENIUS Act allows stablecoin issuers to reserve dollar-pegged tokens with bank reserves.