Circle Internet Group’s shares fell 4% on Wednesday after a Wall Street Journal report indicated that a group of more than a dozen financial institutions, including JPMorgan Chase, Bank of America and Wells Fargo, are evaluating whether to launch their own stablecoins.
The move marks a shift in stance among large banks, which had previously dismissed stablecoins and instead focused on building tokenized deposit systems. Over the past year, some bank executives questioned the demand for stablecoins and lobbied against crypto firms offering products that function similarly to bank deposits. The industry had coalesced around tokenized deposits as an alternative digital asset solution.
JPMorgan, which already operates a tokenized deposit platform called JPM Coin on its private blockchain, said it has no immediate plans to issue a stablecoin. A spokeswoman stated the bank would assess options based on evolving customer demand and regulatory conditions.
The report also highlighted involvement from major nonbank companies, including Visa, BlackRock, Google and DoorDash, in advancing stablecoin-related initiatives. Tether and Circle currently dominate the stablecoin market, which has a combined circulation of roughly $200 billion.
The renewed interest from traditional financial institutions comes as banks reassess the potential overlap between stablecoins and tokenized deposits, with some executives concerned that stablecoins could compete with their core deposit-taking businesses.
