This was an easy one to forecast.

While we are not talking about JPMorgan (Chase) or Bank of America, a fully insured depository bank announced it rolled out its own stablecoin.

SoFi, a nationally chartered US bank, has brought SoFiUSD to market. This is the first of what I expect to be a long line of banks that move in this direction.

It is something I wrote extensively about since the passage of the GENIUS Act in the US over the summer. Trillions in stablecoins are about to hit the market as some of the biggest names are poised to enter.

SoFi is not the largest of players but it is big enough to turn some heads. Traditional financial institutions are going to be all over crypto. When it comes to the killer app, stablecoins might be just that.

With this, we see the first national bank to enter the arena. It is a turning point for the entire industry.

Source

The Banks Are Coming - SoFiUSD

It should come as no surprise that the first bank to enter is actually a FinTech company. The bank is a subsidiary of SoFi Technologies.

Why is this such a big moment? To me, it is the onset of a massive gold rush by the banks. As noted in articles about Coinbase, the doors are swinging open in many different directions. Crypto is more than just payments. We are talking about digital assets that are poised to replace the existing financial system.

Traditional entities are not going to sit back and miss out. They are positioning themselves as gatekeepers for the future. Of course, a case could be made the competition is going to be fierce.

SoFi is getting a jump on other banks by entering now. They still have a long way to catch up to either the Tether Foundation or Circle, the two leading stablecoin providers.

According to the company's press release:

With the launch of SoFiUSD, SoFi is the first national bank to issue a stablecoin on a public, permissionless blockchain SoFi Technologies, Inc. (NASDAQ: SOFI), the one-stop shop for digital financial services, today announced the launch of SoFiUSD, a fully reserved U.S. dollar stablecoin issued by SoFi Bank, N.A. SoFiUSD will enable SoFi to serve as a stablecoin infrastructure provider for banks, fintechs, and enterprise platforms.

SoFi is now the first national bank to offer open access to its stablecoin, SoFiUSD, and stablecoin infrastructure, bringing bank-grade oversight and reliability to companies looking to integrate stablecoin products and services. With SoFiUSD on a public, permissionless blockchain, partners can move funds around the clock with near-instant settlement at fractional-cent pricing. This enables them to manage liquidity with more confidence and deliver faster and more transparent services to their customers. SoFiUSD will also be available soon to all SoFi members.

Here we are seeing another example of infrastructure being built. SoFi Technologies is already serving existing customers. This means that integrating the stablecoin into different operations is going to instantly increase utility.

SoFiUSD will be used in settlement not just of its crypto trading business, but can be used by card networks, retailers, or businesses that want 24/7 settlement safer, faster, and at a lower cost. SoFiUSD will also be a key element of SoFi Pay for international remittance and everyday consumer point-of-sale purchases in addition to providing an alternative form of payment for Galileo's partners that drive billions of payments per year.

This is a story we see discussed repeatedly. The idea of settling billions of dollars in transactions via stablecoins on public networks will be the norm. It is what most of the entities entering the fray are focusing upon.

US Dollar Dominance

This is something that few seem to want to acknowledge.

Never was there a currency more hated than the US dollar. It is something that was true for most of my adult life. Back in the late 1990s, the narrative was the euro would replace the dollar as Europe rose up as a rival to the US. Since there was only one superpower after the fall of the Soviet Union, the Europeans felt it would be the next one to emerge.

Obviously, they were wrong.

China is now the second biggest player. That said, when it comes to finance, the yuan is not on the radar. Due to the closed nature of the Chinese economy (and banking system), we see how there really is nothing on the horizon.

Stablecoins are taking USD deposits and spreading them throughout the world. Since blockchains operate globally, more volatile currencies are at risk.

SoFi is moving in this direction as will most of the banks that enter.

And for companies operating in countries with volatile currencies, SoFi plans for SoFiUSD to be used as a secured dollar-denominated asset in a consumer debit or secured credit account.

What happens to the market when JPMorgan, Citigroup, or Bank of America enter? These are entities with trillions of dollars under management. Their operations span the globe, resulting in trillions of everything they are involved.

It is why people like Treasury Secretary Scott Bessent put the total market cap of stablecoins (USD) at $3 trillion. Some have stated it will be a higher number.

Either way, we are seeing things just getting started. SoFi is now in the game. Expect other banks to follow throughout 2026.

Posted Using INLEO