Stablecoin Part 4

Who are we going to leverage, and how are we going to leverage partnerships in the space?

Hey, GonzoBankers. Tony DeSanctis back with another hot take.

We’ve spent a lot of time talking about stablecoin, but there’s a lot going on in the crypto space overall. So I wanted to just kind of recap some of the things that are happening and give you some thoughts on how I think we, as community institutions, should be thinking about those things.

So obviously, the stablecoin GENIUS Act has gone into effect. We’ve talked about that extensively. I’m not going to go down that rabbit hole too much, but there are a couple of other things that have started happening as a result of that that I think are worth monitoring.

A number of partnerships. So PNC has announced a partnership with Coinbase to begin to offer those products. Goldman Sachs and Bank of New York have just announced a collaboration around deposit tokens, similar to what JPMorgan did in that space. So not necessarily stablecoin, but more representative of deposit outstandings.

And then JPMorgan also announcing that they’re going to start evaluating potentially lending against crypto assets.

So there are a lot of things happening in the space, and I think the takeaway for us as financial institutions is to think about three things.

One, obviously, stablecoin and how we’re going to think about our stablecoin strategy.

The second is, who are we going to leverage, and how are we going to leverage partnerships in the space?

So we talked about those collaborations and partnerships. You’ve also got some of the stablecoin issuers that are not banks today looking at non-bank charters in order to be able to offer those products.

And then finally, thinking about what are the lending implications in the crypto space? In a space where the assets, while still very volatile, are absolutely demonstrating value over the long term and some sustainability.

Some folks are going to have a significant portion of their assets in those cryptocurrencies. Are we going to be willing to lend against those and take part in the potential revenue associated with lending against those assets? Or are we going to cede those to the larger players in the space?

So those three things, I think, are the things you should be thinking about as it relates to crypto in general, stablecoin being obviously still the biggest part of that.

Let us know in the comments what you’re going to be doing in the space and how you’re thinking about those things, and we’ll see you next time.