Link: As Tether says it is on track for a record $10B net profit in 2024, banks around the world are exploring launching their own stablecoins for payments (Bloomberg)

Banks are now eager to enter the stablecoin market after initially observing the success of market leader Tether Holdings. Societe Generale - Forge and others have launched or are planning to launch their own stablecoins in Europe.

With recent regulatory clarity in Europe and Tether discontinuing its EURt stablecoin, there's now a significant opportunity for banks. They aim to provide customers with stable, fiat-like digital currencies for transactions and savings.

Visa Inc. is facilitating this shift by providing a tokenization network, helping banks like BBVA pilot stablecoin projects. This support from established financial networks underscores the growing institutional interest in stablecoins.

However, challenges remain, including regulatory aspects like reserve requirements and consumer protection concerns. U.S. regulators are expected to provide more guidelines on how banks can safely issue stablecoins.

Amidst these developments, central banks are also experimenting with digital currencies that could compete with or complement bank-issued stablecoins. Both forms aim to improve the efficiency of the existing financial system.

The overwhelming interest and strategic movements by major banks suggest that stablecoins may soon become a mainstream financial tool. JPMorgan Chase and others believe these digital currencies will only grow more popular, integrating into the broader financial landscape.

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