- Bank of America plans a USD-pegged stablecoin pending regulatory approval.
- CEO Brian Moynihan confirms the bank’s readiness to enter the stablecoin market.
- U.S. stablecoin legislation could enable major banks to issue digital assets.
Bank of America CEO Brian Moynihan says the bank is prepared to introduce its own USD-pegged stablecoin if federal legislation allows it. Speaking at The Economic Club of Washington, D.C., he stated that regulatory clarity would determine the bank’s entry into the stablecoin market.
According to Moynihan, stablecoins’ stability mirrors money market funds and traditional banking functionality because they are major components in transactional activities. Stablecoins currently dominate market use, but their mainstream adoption by banks will require a well-defined regulatory system.
Regulatory Landscape and Market Expansion
The United States observes rising discussions around stablecoin regulatory control. The chair of the Senate Banking Committee, Tim Scott, plans to work on advancing stablecoin legislation in the first 100 days of Donald Trump’s presidency. Such approval would enable major financial institutions like Bank of America to launch their own stablecoin operations.
PayPal became the latest payment firm to join the stablecoin market with the launch of PYUSD in 2023. Traditional banks recognize stablecoins as promising, with the current market exceeding $232 billion. Furthermore, JPMorgan Chase and other financial institutions started employing blockchain technology for payment operations in 2020.
Bank of America’s Investment in Digital Technology
The Bank of America maintains substantial investments in digital technology and tools. Moynihan disclosed that Bank of America dedicates $4 billion annually to innovative efforts alongside $9 billion spent annually to operate its technological infrastructure. Digital transformation is the bank’s primary focus as customers now use digital and mobile channels for their interactions, which amounts to 90%.
Bank of America continues to operate from nearly 3,700 branches nationwide while aiming to advance its digital banking initiatives. According to Moynihan, estate management and financial planning require human interaction through in-person banking because technology does not fully resolve all financial challenges.
Growing Institutional Interest in Cryptocurrency
Traditional financial institutions are re-evaluating their digital asset policies as regulatory changes in the industry. For instance, JPMorgan expanded its blockchain-based payment network at the same time Standard Chartered tested Mastercard’s Multi-Token Network for digital transactions.
According to Moynihan, the bank holds multiple blockchain patents, which demonstrates how it could advance into cryptocurrency when receiving regulatory clearance.
Lawmakers’ progress in creating specific regulation frameworks for stablecoins motivates major banks to prepare for digital asset integration. As regulations pass to allow its launch, Bank of America’s introduction of its stablecoin will transform the financial sector.