Big banks hop on stablecoin bandwagon | #333

Also, CFPB looks to rescind open banking rule

Jun 02, 2025

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This week:

Big banks hop on stablecoin bandwagon
CFPB petitions to rescind open banking rule
Stuff happens

1. Big banks hop on stablecoin bandwagon

The emerging theme for 2025 is the tokenization of the U.S. dollar. Now with regulatory clarity on the horizon, big banks are looking to get in the game.

From the WSJ’s exclusive report:

The nation’s biggest banks are exploring whether to team up to issue a joint stablecoin, a step intended to fend off escalating competition from the cryptocurrency industry.
The conversations have so far involved companies co-owned by JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and other large commercial banks, according to people familiar with the matter. Those include Early Warning Services, the operator of the peer-to-peer payment system Zelle, and the Clearing House, the real-time payment network.
The bank consortium discussions are in early, conceptual stages and could change. Any final decision would depend on the fate of legislative actions around stablecoins and other factors, such as whether the banks find there would be enough demand for them.
Banks have been bracing for the possibility that stablecoins could become widely adopted under President Trump and siphon away the deposits and transactions they handle, particularly if big tech companies or retailers get in on the action. The banking industry is in catch-up mode in the crypto space after a regulatory crackdown two years ago.
…

Banks see an opportunity for stablecoins to speed up more routine transactions, such as cross-border payments that can take days in the traditional payments system. There is still some skepticism about the security of stablecoins and the regulatory implications of getting involved with digital assets, some of the people said.

Such is the current trend—banking and blockchain are converging. (And it’s a two-way street. Last month, the WSJ reported that titans of the digital asset industry like Circle are looking into applying for bank charters.)

Relevant:

2. CFPB petitions to rescind open banking rule

Here’s PYMNTS (via Ron Oliveira):

Apparently, the days of Rule 1033 are numbered. In fact, as of Sunday (May 25) they might be down to four, as the Consumer Financial Protection Bureau’s (CFPB) general counsel indicated late Friday that it will petition a U.S. District Court in Kentucky on May 30 to have the rule rescinded.
The action took place as part of a status report from the bureau in its defense regarding a lawsuit filed against it and acting Chairman Russell Vought by several banks and the Bank Policy Institute (BPI). BPI and co-plaintiffs argued that the CFPB lacks the authority to mandate free, comprehensive data-sharing and that the rule risks undermining safer, emerging private-sector open banking efforts. They also raised concerns about the rule’s potential to increase fraud and scams, fail to hold third parties accountable, and allow third parties to profit from systems built by banks.
“After reviewing the rule and considering the issues that this case presents, Bureau leadership has determined that the rule is unlawful and should be set aside,” the CFPB stated in a court document released late Friday. “To that end defendants intend to file a motion for summary judgment by May 30th, 2025, the date that this court had set for plaintiffs in its March 27th order.”
As has been the case with the bureau’s recent announcements, including the recession of the BNPL/Credit Card rule, details were scarce, and reactions muted due to the holiday weekend. The industry will now spend the week identifying and scenario planning for life without the rule, which was enacted in October 2024 and went into phased enforcement in January.

USBC

Big banks hop on stablecoin bandwagon | #333

Also, CFPB looks to rescind open banking rule

1. Big banks hop on stablecoin bandwagon

2. CFPB petitions to rescind open banking rule

3. Stuff happens

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