US Bancorp has initiated a stablecoin pilot program on the Stellar blockchain, reflecting a broader trend of banks exploring cryptocurrency technologies. The bank is collaborating with the consulting firm PricewaterhouseCoopers (PwC) and the Stellar Development Foundation for this initiative.

“The bottom line is institutions have arrived. New financial infrastructure is taking shape now, and US Bank, PwC, and SDF are working to unlock the next wave of digital banking,” stated the Stellar Development Foundation on Tuesday.

US Bancorp oversees assets exceeding $664 billion and reports an annual revenue exceeding $27.5 billion, as noted by the bank.

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Stablecoin Pilot to Explore Blockchain’s Capabilities

Kurt Fields, PwC’s blockchain lead, remarked during an episode of the US Banks podcast, Money 20/20, that the primary goal of the pilot is to showcase blockchain’s potential in a secure, bank-compliant setting.

“We’ve been talking about blockchain for years, and we’re at a point now where it’s not about innovation anymore,” he mentioned.

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“It’s about practical application in a rigorous, highly regulated environment where we’re taking advantage of the tooling on-chain in this case on the Stellar network to demonstrate that the promise of programmable money actually yields benefits for not only the institution but the customers that they serve.”

Stellar Selected for Its Asset Management Features

The Stellar blockchain launched in 2014 with a mission to facilitate cross-border transactions and enable asset tokenization. Mike Villano from US Bank emphasized that the choice of Stellar for this pilot was influenced by its capacity to manage transactions effectively, including asset freezing and unwinding.

Villano stated, “Stellar’s fundamental capability to freeze assets and revert transactions was crucial for customer safeguards.”

US Bank is also investigating tokenized assets as part of its ongoing research.

“We’re excited to see where that research goes for us as well.”