Big banks explore venturing into crypto world together with joint stablecoin
wsj.com
wsj.com
A bank doing stablecoins will still need to implement these controls.
Stablecoins only really work because they are outside the system.
Presumably she'd need to exchange it for cash since retail acceptance of crypto is pretty low, and the local exchange place that takes WhateverStablecoin and hands out cash is going to take some commission. And at that point it seems like we've just reinvented Western Union or Moneygram.
In your view is the advantage of the hypothetical stablecoin way of doing this that it exists outside of the money-transfer provider ecosystem until its actually exchanged?
So what banks do is become increasingly paranoid about who they will they bank, meaning anyone who falls into the "high risk" category, is extrajudicially punished through systemically high risks of being debanked. In this way, the state can punish certain groups without due process.
The mechanism often involves correspondent banks, and is generally pretty expensive ($25-$65).
For scale, we’re talking about transfer fees measured in cents with stablecoins.
I don’t see how crypto boosters get around the fact that more than 0% of regulations are legitimately desired by most of the world. And those require some non zero amount of bureaucracy and money to enforce.
> I don’t see how crypto boosters get around the fact that more than 0% of regulations are legitimately desired by most of the world. And those require some non zero amount of bureaucracy and money to enforce.
Taking the statement literally as-is: Yes, a strictly > 0 amount of overhead is required to perform said compliance activities.
But the overhead similarly can *never* be 100% of the money being transferred over. And right now, the transfer costs have only ever been shown to grow, and never shrink in isolation. They only shrink when a new competitor comes in to provide said service, which has rarely ever happened because of said regulations that progressively saddle them with more requirements.
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> I don’t see how crypto boosters get around the fact that more than 0% of regulations are legitimately desired by most of the world. And those require some non zero amount of bureaucracy and money to enforce.
Interpreting this emotionally:
You're leaving out the implicitly-made conclusion that most pro-crypto people will make: That the current banking system *has* to be accepted as-is, useless systems & fee-draining & all that jazz, *and* that they should just take it.
You've already lost all attempts to convince them with that rhetoric. By not putting in more clarifying statements, the gaps have been filled in with the negative implications that will turn them away from supporting your view.
It will be seen by pro-crypto people as own-side points scoring.
In many cases you can now transfer money instantly and free across European countries. If there’s a will there’s a way.
Turning crypto into an acceptable banking system is probably just as hard, if not harder, than making the existing banking system better, faster and more user friendly.
We’ve been promised crypto would revolutionise payment for more than a decade now. In the same timespan I’ve seen my little country develop a common payment app shared by all banks which has made payment to shops and between people instant and super easy. We didn’t need crypto to make progress.
If banking regulations were relaxed to the point where crypto could be used more widely, traditional banks would also be able to innovate much more quickly without crypto.
In the end, I don’t find it entirely unlikely that banks may use a blockchain to do some of their international settlement. It’s a nice algorithm in the cases where you don’t want a single master arbiter. But it’ll probably be a fairly boring behind-the-scenes kind of thing.
You'd have an account at the ECB that you can keep your digital euros in and exchange to and for liquid euros. You'd get the ECB interest rate.
Then if banks want to convince you to hold your eurocoin on their wallet / exchange / stake it, they'd have to offer better features and better interest than the ECB.
Sadly banks are in full swing trying to torpedo the proposal with lobbying, to the point where there's a lot of noise about the ECB only being allowed to be a facilitator and not allowed to be actual competition to the bank, and instead it's banks that should get the sole right to hold digital euro accounts.
> But we enjoy pretty advanced banking services and arguably the most flourishing fintech ecosystem by worldwide standards
Interestingly enough the US does have very modern financial institutions: credit unions. An American woman I met in Vietnam and traveled together with for a bit had a Charles Schwab account that had more features, more free overseas withdrawals and a nicer mobile app than my Dutch bank. It was almost on par with Revolut / N26 / Bunq.
Charles Schwab is the 12th largest bank in the US by assets.
I do agree that credit unions can be great, however, the experience between them is wildly inconsistent. Some have apps that barely work, and some have decent apps that are a bit dated and clunky. The big banks generally have the best UX/support/etc.
It's weird to call it a "digital euro" because the euro is already digitized by traditional banks! At an existing traditional bank, your balance is already a discrete number. Money can be sent and received electronically on communications networks without using physical media like coins and bills and cheques.
1) Is that automatically good? Damn those capitalists and their slow and steady approach to major changes, I suppose. Wouldn't want to proceed too thoughtfully.
2) The free market in banking looks pretty much exactly like the crypto ecosystem. As people often put it, speedrunning banking history. The only thing slowing the financial institutions down is the regulation (which is pretty much the pro-regulation argument of "if we don't regulate it they'll do a bunch of stupid things too quickly").
There isn't something of a free market in banking but the limitations are extreme enough that it is more of a heavily mixed to centralised one. Interest rates are managed by a central committee and banks provide any colour of service you like as long as it is black. Typically heavy KYC regulations to link the system to law enforcement and state intelligence systems. There is enough freedom to keep the fees fair and a bit of flexibility in what the money gets invested in which is pretty good. But for transaction speed I'd actually be a little surprised if the banks were allowed to control their own settlement timelines; I assume going to quickly would start running in to KYC-style compliance problems.
Considering how long it’s taken even the most progressive regulations to be enacted, it’s arguable that we’ve done anything but proceed without thoughtfulness towards how these changes affect the other 99% of the population.
We sure do spend a lot of time letting the wealthiest folks skim those points off the top without spending any more than they are required to by regulations, though.
However, there's FedNow immediate transfers, Zelle (consortium of banks) immediate transfers, same day ach (several batches daily), same day fed wire transfers within banking hours, and that's just the faster options.
Decentralized systemd are slow to act and slow to change, which is why all of the faster banking initiatives tend to involve a centralized element.
If the big US banks are successful, they can have their own one huge fractional reserve that can be used by people around the world.
While the wording was imprecise, actually this is what banks are doing: Creating loans, based on the deposits of customers.
Private banks create money by extending credit, that's it. They worry later about reserve requirements, which in the case of USD or EUR are extremely low.
And I still don't understand how this relevant in any way to the topic.
They are expanding credit, but they need customer funds on the central banking level to actually move away the money the created on their local core banking; thats the reason why banks needs customer funds: Without them, their central bank account would be empty and they couldnt transfer any money that they created. the question regarding minimum reserve is another angle and not relevant to the question of how money is technically created and then transfered.
EDIT: for sure, they can also acquire central bank money as a credit to make the payments transfer happen, but usually its more easier and convenient to use customer funds instead of borrowing from the central bank or on the interbank level
A simple (and contrived) example: Let's say I want to send you $100 on Tuesday, but only on even-numbered hours. This is a trivially easy smart contract to write. Sure, you could do this with crypto, but if you want to protect yourself against price fluctuations it makes sense to use a stablecoin.
Amazing utopia awaits for us, can't wait to take part in that hell economy :)
People who want independent currency, or maybe less dependent on the govt would get a currency absolutely under control of a small group of people in the govt. People who donate to privacy foundations or buy privacy tools would see that they simply aren't allowed to do that with their "money" (non-fungible tokens). People who want to pirate stuff or download some info would have DMCA strikes not on their neat little blog or youtube channel, they will have DMCA 2.0 strikes right on their bank account, because all that shit will be automated and centralized. Just imagine, downloading something and then getting all your accounts go to 0. Or maybe not to 0 but have a fine applied and subtracted from your token balance automatically, on the discretion of the megacorp across the ocean in a different country.
It is literally dystopia, no scare quotes, no ifs no maybes, it just is.
But if it would be a token system, then ALL accounts in that token in ALL countries are fully under control of the USA central bank.
Also currently all dollars, or yen, or yuan, are fully fungible. You can spend any single dollar on anything you want and in reverse any sold good/service acan be bought with any dollar in existence, they are the same. Now tokens are not like that, they are non-fungible and can (and will) be limited in multiple ways. For example you can have 1000 tokens in your account, but out of them only 200 can be spend on the "bad" goods like alcohol or gambling or whatever (on political opposition support, on different religion donation etc.). Or for example you have 1000 but they have an expiration date and will go to 0 in one calendar year, so that you won't save them. The possibilities are endless.
In fact, all of that has been already tested in my Eastern Europe country (Ukraine). We had a pilot program of digital tokens. They required a separate account of course, they couldn't be converted o the regular digital money. Every tranche had an expiration date (for example first one was half a year, next one a year iirc). They could have been spent only on a specific list of goods defined by the government - in that pilot it was only approved entertainment like books, movies and also donations were allowed.
I'm personally horrified by this very real and very close future prospect. Like that's not even some abstract Matrix or Cyberpunk level horror. It is here, it is almost deployed. EU is talking all the time about it. It is mind boggling to me how regular people aren't protesting this shit. Don't you all see the implications?
Also, there's nothing stopping foreign banks from issuing their own stablecoins. Owning a US bank-issued stablecoin is like having an account with that bank. If you have a problem with that, then you can swap your balance for a EUR-backed stablecoin issued by a European bank. Or better yet, you could sell it for real USD or EUR.
All that text above is just underscore this - a future Fed owned token would be on a completely different level of control. Cross border control too.
Regarding alternative token systems - a) outside of maybe 2-5 tokens all others won't be adopted and die out (unless enforced in a totalitarian way), b) the survivors will share the same traits, copied from one to another, after all they will be controlled by the same orgs - central banks.
And finally - no, you won't be able to sell tokens to money. Only if the owner of all tokens (a central bank) will graciously allow it. For example in the pilot in my country it did not. Thinking logically - if token system is created to restrict freedoms and bring more control to the govt, why would that govt allow "exiting" this new system? Everyone who cares and all potential targets will sell this token and go back to using money. So of course any bridges will be either heavily restricted (for the inner circle, corrupt officials, oligarchs etc.) or won't be allowed at all from the start.
Also, you can always write wrapper coins for other stable coins that don't have any spending restrictions. And yeah, issuers can play whack-a-mole and ban those contracts. But at that point we're talking about a coin that no one would even recognize as money any more. Why would anyone use it? If they're already on the blockchain it would be a pretty seamless switch to just use the native token.
And at the end of the day, if you can exchange your dystopian stablecoins for USD (as the legislation requires) then you can functionally spend your money with the same restrictions that are on your bank account anyhow.
You’re handwaving this away. Just because something is theoretically possible, it doesn’t mean that it’s as likely to happen as something else that is order of magnitudes less complex (imposing the level of fine-grained control discussed in this thread on the existing system, versus building it in from the beginning in a new one). Friction and inertia matters in the context of preventing government overreach
> Why would anyone use it?
Because the government mandates it. Because the only employers that will hire you pay out wages in it. You can imagine many scenarios where individuals don’t have much of a choice. Which could be a reason for someone to want this idea to not catch on, lest the current system gets replaced by something worse. Cheerleaders and enthusiasts may take the opposite view
> if you can exchange your dystopian stablecoins for USD
Yes, if. And for how long?
I’m not saying a motivated totalitarian regime controlling all levers of powers could necessarily be prevented from implementing their dystopia anyway, but we also don’t have to expedite technology that would make it significantly easier for them
Remember, issuers want people to use stablecoins because they get to invest the funds in treasuries and hold onto the interest. If everything is blacklisted then no one will want to use them and the issuer won't make any money.
In any case, I don't think that's the sort of product that commercial banks are itching release when they launch their new stablecoins. I'm sure a lot of coins will have a deny list for AML/KYC reasons, but an allow list would be pretty cumbersome to maintain and probably turn off most users.
Not trying to get pulled into any arguments about whether cryptocurrency is good or bad, just some potential answers to your question.
This is not realistic for the average person.
In roughly the same way there's no such thing as "very good cybersecurity for the average person."
I know HN skews hard for electronic payments but cash is still heavily used. One nice trait is that its weaknesses are highly intuitive: there’s no retroactive de-anonymization or tracking across unrelated transactions, and people are familiar with how physical objects are stolen.
What about a simple but not contrived example (or if no good simple examples exist, a complex one)? Smart contracts are neat but I'm not sure there's any real benefit, especially for banks which likely don't need to do things without trusting each other.
That's just "automatic bill pay" without a bank, etc.
Paying wages that are only valid for a month, are split into parts which can only buy specific foods and goods inside a geofenced zone and can't be tranfered to any other person are much more likely.
What you're describing can only be achieved by encoding specific logic into the coin's original contract, so you'd know what you're getting yourself into ahead of time. And this is tantamount to agreeing to be paid in a specific gift card with a really small payment network. No need to get crypto or stablecoins involved.
That does not mean that you have the power to do anything about it.
Seems like you haven’t had much time with the history of company towns and company stores.
Yeah. We would know. We DO know it now. It is being tested now, exactly like described by GenshoTikamura. I've wrote you a longer comment about that below.
Do you see people protesting? I don't. Lol, even here at HN, at the bastion of independent thinking or close enough, people aren't protesting. Most it seems aren't even aware about the scope of the features of such token system, and the implications to the daily life.
What happens if you don't have the money available? If you want to provide some guarantee, how would you do it without locking up N x $100 forever? What are even numbered hours - which timezone? What happens if your transaction doesn't get accepted within that timeslot? Etc. etc.
That's sort of besides the point though. I'm just saying that you have the ability to implement whatever ad hoc or arbitrarily complex payment logic you want without relying on a middleman.
[Edit] corrected website URL.
The correct one is: https://www.worldlibertyfinancial.com/
If so, what is the point of stablecoins if the banks themselves are running it? If regulations and technology are no longer an issue, can’t they just make USD transfers fast and easy? Why bother with a wrapper around USD?
I think you missed "profitable" from that list.
There's a huge gulf between a night at the poker tables, and buying into a little of MSFT's dividend, and it's really disengenuous to pretend they're the same.
its cause regulation???, easy and fast to moving money its good until you got hack from state sponsored actor that you can't even do anything (ehm ehm north korea ehm)
in seriousness, people can get away with billions of dollar and "vanish" is wild world if you think about it.
USA is just bad at governing. Tries not to tell corporations what to do, so it ends up with toothless half-assed laws that do nothing except being a tool for regulatory capture.
If they want, then they can make banks the only entities who can hold their stablecoin, and the whole thing would be invisible to everyone else.
If they allow other people to hold the stablecoin directly, then they could still have the invisible system with banks holding it, plus there'd be extra capabilities on top, like letting people use the coin in smart contracts.
Once AI takes over and these digital currencies are “smart” and tightly integrated, we’re going to be living in a Black Mirror episode.
Sending USD from random bank from random country to another random bank from another random country is a network problem. While it’s solved by SEPA in EUR to EUR countries by pan european clearing and settlement systems, out in the big world it’s not as simple. Specially considering cross-border.
You have to somehow get the payment message across banks and decide on how to settle. It fundamentally a hard problem.
Stable cryptos put the message and settlement in the same system and it’s a global one (not just EU/wtv). The problem is then, which stable crypto? The moment the Fed has a USD crypto, our ECB has an Eur crypto, than that problem is solved. In the meanwhile, joining a big stable usd crypto might still provide you better remittance routes (and settlement) than sending messages over swift.
Tldr: stablecoins solve remittance routing “edge cases”, if the stablecoin is adopted enough
Similarly, if BoA supported an Ethereum stablecoin but a random bank in Argentina supports a Solana stablecoin, it’s still going to be a pain to transfer money right?
I’m struggling to see how this is a blockchain issue rather than a regulatory + agreement on international standard issue.
The people who are the thinkers in this space like to quack like libertarians and look back fondly at the gold standard. For better or for worse, they are driving US policy now. It’s one of the reasons why our government is setting the financial and economic system on fire and destabilizing the dollar.
If you want to provide fan service to the idiots keeping you in office, and get really really rich in this process, what do you do? Pivot to crypto as there isn’t enough gold to capitalize the world, and outsource the new version of the fed to private interests.
This is a way to stay relevant from the banks point of view in what whatever this new world turns into. They add value because there’s inherent trust in day JPMC, UBS or Barclays versus some random crypto bro company.
I think at a macro level, the key point is that banks were initially unmotivated/uninterested in, and critical of crypto. The long-term effort behind stablecoins to become compliant and aligned with regulatory frameworks has now positioned them as useful infrastructure. Today, banks can simply adopt or acquire the benefits of a system they had no interest in building themselves. The current US administration clearly helps.
My error was in believing being a scam had any correlation with whether or not something would be successful or not.
The point is for banks to remain powerful in a world where cryptocurrency is at thing; in other words, to subvert the point of cryptocurrency.
I think people don't know how hard to moving actual real money in terms of millions to billions
[0] https://edition.cnn.com/2025/02/28/investing/citigroup-bank-...
[1] https://www.straitstimes.com/business/banking/citigroup-acci...
Other countries have done somewhat similar things over the last century.
On the same topic, real currency can become or be made worthless due to hyperinflation (and even normal inflation).
[1]: https://en.m.wikipedia.org/wiki/2016_Indian_banknote_demonet...
In most countries where demonetization occurs, the central bank continues to accept demonetized currency for the foreseeable future, exchanging it for valid denominations at par.
The government of India came down hard on corruption and tax evasion, more politically motivated than anything. But then people voted for it and the majority supported the process. If they didn't, the government would have been discarded in the next election.
How cool would it be to have a decentralized coin that has zero percent inflation.
Coinbase was in the Summer 2012 batch. 13 years ago seems like a good sign that they weren’t as ignorant as you claim. There are currently 73 companies listed on YC as being crypto/Web3.
But you are still correct that the majority of HN missed out on crypto and thus are allergic to it and now they are fans of anything "AI" despite not even knowing that "AGI" is a scam with the real intention of causing a 10% increase in global unemployment.
In fact, AI is more likely to be the cause of another financial crash than crypto, once we see mass layoffs accelerating.
All of the NFT infrastructure will be repurposed for tokenized bonds (Real World Assets or RWAs) and the size of defi and crypto network assets under management will skyrocket, and become deeply intertwined with tradfi
Privacy coins (like my username) are only going to get stronger and harder to kill
It will be much easier to raise funding for tiny startups, like you could back in the pennystock days and IPOing garage businesses. Formalized and strong names / credentials / legal remedies will enable far easier capital formation for risky companies
Especially with UX, the likes of https://www.privy.io/ is interesting, now we finally have "non-custodial" wallets with just a google-login. (check how it works, its pretty cool). This means any user for any web app can have a "bank accocunt"
Other stuff is zkEmail/zkTLS for verifiable data portability without exposing raw private data (huge for things like "vampire attacks"), and TEEs with fine-grained, 'OAuth 3.0'-style access control for private compute are compelling.
I think the point is who won the bet with the current US administration. Also remember that Coinbase was part of YC.
https://www.creditslips.org/creditslips/2025/05/the-genius-a...
if they start buying and Pumping bitcoin, it would be so funny
US banks already create money out of thin air and a vast majority of that money only exists in a database. If they want it faster they could just do that.
Banks seem to be pointing at the same need and I just don't see why. At best it gets around regulation if a stablecoin isn't treated the same as fiat. With either, though, a bank can already create and give out whatever they want and track it in a database (all be it a more standard db and not a blockchain or public ledger).
Banks in the US are somewhere between a legally protected monopoly and a racket. They would only make more money if they can charge higher fees or convince the economy as a whole to make more or larger transactions.
If banks could do either of those with a stablecoin they could do it with USD, which again is effectively a stablecoin that lives in the banks' private databases.
US treasuries becoming undesirable doesn't really have an effect on stablecoins, because (at least for USDC and I believe USDT) they hold short term treasuries that expire in a few months. The operator of the stablecoin can just hold the treasuries until they expire. Also if the operator of USDC can't pay out all claims right now, they will be in a few months so an oportunist market maker can buy USDC for 98 cents on the dollar and cash out 100 cents a few months later.
They were not legally currency (or legal tender) but acted as such. It if a bank was viewed to be in trouble its notes would start trading at a discount.
Effectively it was a free market for currency issuance. Which I guess this would be too?
First, there's Tether > We're the only option in town. Then, there's Circle > We're more legit than Tether, we're based in the US. Now, there's the banks > We're more legit than Circle, we're banks!
Eventually, the Fed itself will start issuing stablecoins and out-legitimize everyone else.
That would be a CBDC (Central Bank Digital Currency), which the current administration doesn’t seem to want. One advantage of such a CBDC would be that central banks of other countries could be persuaded to use them (for cross border payments and transfers), whereas a stable coin issued and managed by a group of banks would likely not have this advantage (not saying never though).
The point of a CBDC is government control over an increased share of the money supply. Pretty irrelevant to USD balances held by other central banks.
The point of a stablecoin for an entity with an American banking license is... nothing?
That's doubtful everyone else will be out-legitimized ... because ultimately the Fed will issue coins they can fully control (freeze, delete, etc. whenever they wish so). That doesn't make holding such money very valuable. A lot of people understanding this concern will favor USDT or similar privacy oriented coins and thus these coins will keep flourishing (however USDC could disappear for this very reason).
This plan assumes the current mercurial administration stays their course on stablecoin to replace USD as reserve currency and future administrations also going along with it.
It’s a massive gamble that depends on many variables.
For now, it’s a PR move.
You are operating on the assumption that there will be fair election in 4 years and that Dems will retake the White House. Both of those are unlikely. Trump has almost killed democrarcy in 3 months. I'm sure he'll get the job done in another 3.75 years.
Or the universal "credits" seen in scifi?
So much for Satoshi's cryptoanarchy.
I personally think that after Biden's COVID response the only way forward goes through eventual financial repression. We can kick that ball down the road for a bit more, but not forever. That said, I would love to hear counter-arguments.
https://fred.stlouisfed.org/series/WALCL
As for treasuries, you have to realize that the primary risk for bond holders is inflationary risk. In fact, high inflation environments make this "risk free" investment very risky indeed. Tariffs will drive inflation. There is little doubt about that as retailers have directly stated that they will raise prices. This force alone will be enough to cause bond yields to rocket. Add on top of that the fact that Trump loves to absolve himself of debt and leave the lenders holding the bag and has even spoken about doing this with some government debt, and you have a recipe for treasuries being seen as utterly toxic. The government will have a very hard time raising money across all maturities, and will have to really sweeten the deal to entice lenders in the future.
This exact dynamic is what caused the 2023 banking crisis and the collapse of SVB.
https://en.wikipedia.org/wiki/2023_United_States_banking_cri...
This administration keeps making the absolute worst possible choices, so none of this surprises me.
Also, FWIW, I honestly don't think my reply seemed that LLM-like. There's no em-dashes. There's no bullet points. Despite my best intentions, there are probably also grammatical mistakes. Perhaps I should stop using proper capitalization like you to remove all doubt!
I also went to Catholic school.
That said, I do not immediately agree with either of your points here. On changing the SLR, to the best of my knowledge it gives the bank an option, not places a requirement on them.
On the SVB collapse: that was a bank run, plain and simple. That particular one was caused by jumpy clients (startups) that reacted to the mark-to-market correction due to the raised rates. The bank's chief risk officer probably screwed up pretty badly, but bank runs can happen to ANY bank, large or small. If enough Citibank, BoA or Chase clients decided to move money out those large banks would be in the same boat (i.e., unable to fulfil those request, or insolvent).
The reason most banks are mostly safe from bank runs most of the time is that small clients believe they will be bailed out by the FDIC (which does not have enough money to bail everyone) and large companies believe they will be bailed out directly by the gov't, printing money as needed to save systemically important banks. But smaller banks do get insolvent regularly, with over 500 since my "because Bush" point of 2001. Nothing special.
The only way out I think is via financial repression, holding rates below inflation, partially inflating gov't debts and partially wiping out savers (and pensions that do not adjust for inflation and a ton of other things) and maybe partially growing the economy out of it. This is a long process, IMO likely to play out over the next 10 years or more and will be painful for those caught in front of this wreck. But it has nothing to do with <insert your evil president or party>" now. My 2c.
It's hardly just an option, when the other alternative is for it to sit idle while we have 2% inflation. It's scary because it betrays the fact that they're already needing to relax a set of totally reasonable regulations put in place after the GFC to ensure that there is adequate demand in long-dated treasuries.
Nothing that crypto is needed for
"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."
Ripple provides both messaging and settlement with XRP
Gas fees would skyrocket and expensive again
Trump has his own stablecoin, USD1.[1]
But how much does it cost to get in and out? That's the question. FedNow charges US$0.045 per transaction.
They need to find business cases elsewhere.
First they ignore you
Then they laugh at you
Then they fight you
Then you win- Banks should have controls over money that are impossible with crypto. It is absolutely vital for any state to control their own currency and the banks need methods to accomplish that.
- Why would banks need a decentralized ledger at all? It makes literally no sense to have banks maintain such a ledger. Banks do not need to solve the double spending problem and you can build a digital currency without a block chain. Not as a theoretical, but right now basically all my banking happens digitally, what is the actual technical point of introducing a block chain to that?
This news reads like big banks and other major traditional finance players are building a database because FedNow doesn't cut it somehow?
Same God damn story, over and over, but with the inevitable bailout. Heads I win, tails you lose.
Specific to this story: most of the world has instant payments without using blockchains or stablecoins, it’s only the U.S. where the banking system somehow hasn’t realised they can do instant payments using traditional banking technology.
Anyone posting that they’re skeptical about the use cases for blockchains on HN 10 years ago will have the same skepticism now. Nothing has changed.
Nothing that crypto is needed for
Cryptocurrency has just one.
I do not count money, as crypt is technically inferior to non-blockchain based digital currencies.
Private banks issuing their own stablecoins will make the banking system little bit closer to the free banking system [0], when banks used to issue their own banknotes i.e. paper currency. This is better, because every stablecoin could have their own risk profile which is associated with the issuing bank, which would lower the overall systemic risk.
On the other hand, a CBDC would be a move in the direction of single-tier banks [1], which centralizes all money issuance to a single bank.
[0] https://en.wikipedia.org/wiki/Free_banking
[1] https://en.wikipedia.org/wiki/Single-tier_banking_system