SAN FRANCISCO– SoFi Bank launched its own stablecoin, SoFiUSD, making it the first national bank to issue a stablecoin on a public blockchain.
The launch follows plans SoFi outlined last month when it debuted SoFi Crypto, its cryptocurrency trading platform for retail customers. At the time, the challenger bank said it was developing a stablecoin and intended to integrate crypto into its lending and infrastructure services.
SoFiUSD will be available to customers and will also serve as the basis for a stablecoin infrastructure that other banks and financial technology companies can use, according to the company. Those firms will be able to white-label SoFi’s stablecoin, and the resulting tokens will be interchangeable with SoFiUSD, a company spokesperson said.
‘Technology Super Cycle’
Chief Executive Anthony Noto called blockchain “a technology super cycle that will fundamentally change finance, not just in payments, but across every area of money,” in a prepared statement. “With SoFiUSD, we’re using the infrastructure we’ve built over the last decade and applying it to real-world challenges in financial services,” Noto said.
He cited slow settlement times, fragmented providers and unverified reserve models as challenges facing companies today, saying SoFi aims to address those issues by combining its regulatory status as a national bank with fully reserved, transparent on-chain technology.
First to Launch
SoFi said it is the first national bank to launch a stablecoin on a public blockchain. JPMorgan Chase and Société Générale have also introduced stablecoins, but JPMorgan’s is private and Société Générale is based in France.
SoFiUSD is initially being built on the Ethereum blockchain, with plans to expand to other blockchains over time, the spokesperson said.
The launch comes amid growing interest from banks following passage of the Genius Act, which established a regulatory framework for stablecoins. Citi and PNC have announced plans to enter the stablecoin market through partnerships with Coinbase’s crypto-as-a-service business.
FDIC Proposal
As part of the law’s implementation, the FDIC has proposed a rule outlining procedures for FDIC-supervised banks to issue payment stablecoins through subsidiaries, as the CU Daily reported here. The agency said there is “significant uncertainty” about how many of the roughly 2,700 banks it supervises will pursue stablecoin issuance, estimating that about 10 applications would be filed each year on average as the market develops.
