Bank of America Eyes Stablecoin Opportunities Amid Regulatory Clarity and Industry Collaboration

Bank of America Signals Interest In Stablecoin Market Pending Regulatory Approval

Bank of America is exploring entry into the stablecoin sector, with CEO Brian Moynihan confirming the bank’s interest, contingent on clear U.S. regulations.

Speaking at recent industry conferences, Moynihan emphasised collaboration with existing players and noted that regulatory clarity is key.

“We’re working with the industry, working individually… the problem before was it wasn’t clear we were allowed to do it under the banking regulations.”

Could Stablecoins Change The Way Banks Operate?

The bank’s potential move comes as stablecoins gain prominence for offering faster, more efficient digital payments, particularly in cross-border transactions.

Analysts note that increased adoption could provide cost and time advantages for both consumers and institutions, with emerging markets potentially benefiting from enhanced liquidity.

Moynihan highlighted the importance of working closely with industry partners to ensure smooth integration and compliance.

GENIUS Act Brings Clarity For Financial Institutions

Regulatory uncertainty has historically slowed banks’ involvement in stablecoins.

The recent passage of the "GENIUS Act" (Public Law 119-27) aims to address this by establishing a Stablecoin Certification Review Committee led by the Treasury secretary, alongside the chairs of the Federal Reserve and the Federal Deposit Insurance Corp.

This body evaluates whether state-level regulations align with federal standards, allowing for a more harmonised oversight approach.

Under the act, state-chartered banks issuing stablecoins with more than $10 billion in circulation will fall under federal supervision, while nonbank issuers will be jointly regulated by the Office of the Comptroller of the Currency and a state authority.

The move is intended to reduce compliance burdens and make market participation more accessible for large institutions like Bank of America.

Existing Players Set The Stage

Stablecoin providers such as Circle and PayPal have already made significant inroads.

Circle’s USDC, pegged to the U.S. dollar, currently has a market capitalisation of around $64.4 billion.

The company is also developing its own layer-1 blockchain, Arc, which will utilise USDC as its native token, reflecting growing institutional investment in stablecoin infrastructure.

Navigating Risks Amid Growing Attention

Despite growth, stablecoins remain under close regulatory scrutiny due to concerns over illicit activity, money laundering, and fraud.

The U.S. Treasury has requested public input on managing these risks, highlighting the challenges banks face when entering the market.

Moynihan’s comments suggest that Bank of America is mindful of these challenges, prioritising compliance and partnership as it evaluates its next steps.

State Initiatives Keep Innovation Alive

Even as federal oversight strengthens, states continue to experiment.

Wyoming has launched its own stablecoin, Frontier Stable Token, while New York and California have implemented tailored regulatory frameworks.

This state-level innovation illustrates the dynamic environment that major banks must navigate as they explore digital asset services.

Bank of America’s Digital Pivot

If Bank of America proceeds, it would join other major corporations—including Walmart, Amazon, and Western Union—in experimenting with digital payments via stablecoins.

The move could position the bank to capitalise on growing demand for faster, more efficient payment solutions, signalling a broader embrace of blockchain technology within traditional financial services.