GENIUS Act Fuels Citi's $750M Stablecoin Push, Accelerating Wall Street's Digital Transformation

Citi Ventures, the venture capital arm of Citigroup, has made a strategic investment in BVNK, a stablecoin infrastructure firm, as part of a broader push by Wall Street to embrace digital assets. The investment, disclosed by BVNK in an interview with CNBC, elevates the startup's valuation beyond $750 million, surpassing its previously reported valuation. BVNK's platform operates as a payments rail for stablecoins, enabling seamless conversion between fiat currencies and digital assets. This move aligns with a growing trend among U.S. banks to leverage stablecoins for cross-border transactions, driven by regulatory clarity from the GENIUS Act, a federal law passed in July 2025 to govern stablecoin issuance and oversight .

The GENIUS Act, which mandates that stablecoin issuers maintain 1:1 reserves and comply with anti-money laundering (AML) regulations, has catalyzed institutional interest in the sector. Jesse Hemson-Struthers, BVNK's co-founder and CEO, emphasized the act's role in fostering demand for stablecoin infrastructure, stating that "regulatory clarity is enabling explosive growth in this space." BVNK's technology, already utilized by firms like Worldpay and dLocal, processes over $20 billion annually in transactions, with a focus on enterprises seeking to streamline global payments .

Citi's investment follows a similar move by Visa, which backed BVNK in May 2025. The Wall Street bank is also exploring stablecoin-related services, including custody solutions for crypto assets and tokenized deposits. Arvind Purushotham, head of Citi Ventures, highlighted the firm's interest in BVNK's "enterprise-grade infrastructure," noting its potential to transform cross-border payment systems. Chris Harmse, another BVNK co-founder, revealed that the company is on track to achieve profitability in 2026, despite current investments in growth .

The stablecoin market has seen rapid expansion, with $9 trillion in transactions recorded over the past year and a total market value exceeding $300 billion, according to Visa and CoinMarketCap data. Citi analysts predict the market could reach $4 trillion by 2030, driven by adoption in tokenized finance and cross-border commerce. This forecast underscores the sector's appeal to traditional financial institutions seeking to modernize payment systems and reduce costs. Harmse noted that BVNK is targeting neobanks and digital-first institutions to integrate stablecoins into their core services, such as checking accounts .

The investment reflects a broader industry shift. JPMorgan Chase recently launched its own stablecoin-like token, JPMD, while HSBC and Bank of New York Mellon are experimenting with tokenized deposits. These efforts highlight the growing recognition of blockchain's potential to enhance efficiency in financial services. Citi's CEO, Jane Fraser, has signaled the bank's intent to issue its own stablecoin, further positioning the firm as a key player in the evolving digital asset landscape .

BVNK's success is also tied to its regulatory compliance. The startup has secured licenses in multiple jurisdictions and partners with Tier 1 banks to ensure adherence to the GENIUS Act's requirements. This framework, which restricts stablecoin issuance to insured depository institutions and mandates regular audits, has provided a foundation for institutional participation. However, challenges remain, including competition from firms like Alchemy Pay and Ripple, as well as regulatory uncertainties in international markets .

The U.S. regulatory environment contrasts with approaches in the EU and UK. While the EU's MiCA framework and the UK's evolving policies aim to integrate stablecoins, the GENIUS Act's dual-track system-allowing both federal and state oversight-has created a more immediate pathway for U.S. banks to innovate. This has positioned the U.S. as a leader in stablecoin adoption, with Citi's investment reinforcing the sector's momentum. As the market matures, the interplay between regulatory frameworks and technological advancements will likely shape the next phase of growth for stablecoins and their infrastructure providers.