Shares of Circle Internet Group fell 4% on Wednesday after a Wall Street Journal report indicated that major banks are reconsidering their stance on issuing stablecoins, a move that could intensify competition in the sector.
The decline followed the report, which cited sources familiar with the matter, stating that banks of varying sizes have become more open to launching their own stablecoins. This shift reverses prior executive skepticism about demand for such products. Previously, the banking industry had lobbied against cryptocurrency firms offering stablecoins that operate similarly to bank deposits, instead pursuing a tokenized deposit system.
Major non-bank corporations, including Visa, BlackRock, Google and DoorDash, have already entered the stablecoin market, which has long been dominated by Tether and Circle. JPMorgan Chase, the largest U.S. bank, has been evaluating the potential launch of its own stablecoin, according to the report. The bank already operates JPM Coin, a tokenized deposit system built on its private blockchain.
A JPMorgan spokesperson confirmed the bank has no immediate plans to issue a stablecoin but stated that it will assess all options based on client demand and regulatory developments. Separately, a group of more than a dozen financial institutions—including Bank of America, Wells Fargo and Spain’s Santander—has been advancing a global stablecoin project, according to the report.
Stablecoins are digital tokens pegged to fiat currencies such as the U.S. dollar, while tokenized deposits represent traditional bank money in digital token form. Some banking executives have expressed concerns that stablecoins could encroach on their core deposit businesses, raising questions about whether both products can coexist in the evolving digital asset landscape.
