Spains BBVA Eyes 2025 Stablecoin Launch in Collaboration with Visa
- BBVA plans to introduce its stablecoin in partnership with Visa, currently in the sandbox development phase.
- The bank is evaluating potential backing options for the stablecoin, including deposits, money market funds, and fiat currencies.
- BBVA aims to build its stablecoin around the euro, with applications for settlements in tokenized asset exchanges.
The second largest financial institution in Spain, BBVA, is soon going to enter the rapidly growing stablecoin market by 2025. In combination with Visa, the financial giant is working through the sandbox for a Visa program intended to help companies issue tokenized assets. Francisco Maroto, head of digital assets and blockchain at BBVA, shared insight into the banks ambitions during a recent interview.
BBVA Exploration of Asset Backing
BBVA has been working on digital assets since 2014, and this expected stablecoin is viewed as a natural next step to reassure regulatory authorities of a moving financial landscape. According to Maroto, blockchain will be a disruptive technology for the new creation and representation of digital value and, expansively, for the whole financial system.
However, details on what and how the stablecoin is collateralized have yet to be decided; Maroto did note a few options: deposits, money market funds, and even fiat currencies like the euro and U.S. dollar.
The stablecoin space is becoming more competitive as different traditional financial players enter. For example, PayPal launched its PYUSD stablecoin in 2023, which only underlined the sectors growth.
Here, cooperation with Visa has become strategic for BBVA because it uses the established reputation of Visa and its regulatory compliance to build a stablecoin that fits well within European regulatory frameworks.
Visas New Product for Financial Institutions
Visas latest announcement introduced a product that would enable financial institutions to create fiat-backed tokens. This means that the banks would decide upon asset reserves that would range between fiat currencies and deposits.
For now, these tokens will function within the specific bank chain, but the long-term goal is interoperability within different financial institutions. The new stablecoin of BBVA will likely be euro-denominated, thus allowing settlements on the exchanges dealing in tokenized assets. The bank sees itself operating the mint-burn mechanisms that convert fiat into crypto ecosystems.
However, despite such ambitious plans, the U.S. market does not currently feature in its plans. It currently offers private banking and institutional clients custody and trading services in Switzerland for Bitcoin, Ethereum, and USDC while launching operations in Turkey.
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Read more: https://www.tronweekly.com/spains-bbva-eyes-stablecoin-launch-with-visa/
Text source: TronWeekly
