Regulatory Clarity Drives Citi's $750M+ Stablecoin Bet

Citigroup's venture capital arm, Citi Ventures, has invested in BVNK, a London-based stablecoin infrastructure firm, as part of Wall Street's expanding foray into blockchain-powered payments. The investment, though undisclosed in size, pushes BVNK's valuation above $750 million, surpassing its $750 million valuation at the last funding round. BVNK's platform facilitates cross-border stablecoin transactions, enabling users to convert fiat to digital assets and vice versa. The firm, which processes over $20 billion annually for clients like Worldpay and dLocal, has secured backing from Visa, Coinbase, and Tiger Global.

The move aligns with a broader trend as U.S. banks accelerate into crypto, driven by regulatory clarity from the GENIUS Act, a federal bill passed in July 2025 to standardize stablecoin oversight. Citi executives cited the legislation as a catalyst for institutional confidence, with CEO Jane Fraser previously indicating the bank's exploration of issuing its own stablecoin and offering custodial services for crypto assets. JPMorgan Chase, another major player, launched its stablecoin-like token, JPMD, and now allows clients to trade bitcoin, reflecting a sector-wide pivot toward digital assets.

Stablecoins, pegged to fiat currencies and backed by real-world assets like bonds, have become critical for cross-border transactions due to their speed, low cost, and 24/7 settlement capabilities. According to Visa, nearly $9 trillion in stablecoin transactions occurred in the past 12 months, with the market cap exceeding $300 billion. Citi has revised its 2030 stablecoin market forecast to a base case of $1.9 trillion and a bull case of $4 trillion, up from prior estimates of $1.6 trillion and $3.7 trillion, citing rapid adoption by digitally native businesses and tokenized deposits.

BVNK's expansion in the U.S., its fastest-growing market, is bolstered by the GENIUS Act's regulatory framework. The firm's co-founder, Chris Harmse, emphasized that stablecoin infrastructure is becoming a cornerstone for neobanks and cross-border payment solutions, with plans to achieve profitability by 2026. Competitors like Alchemy Pay and Ripple also vie for a share of the market, while established banks such as HSBC and BNY Mellon experiment with tokenized deposits.

The investment underscores Citi's strategic alignment with the evolving financial landscape. Arvind Purushotham, head of Citi Ventures, highlighted BVNK's enterprise-grade infrastructure as a key differentiator, noting its role in enabling "innovative financial products with enterprise-ready security and compliance". Meanwhile, the Bank of England is softening its stance on stablecoin caps, proposing exemptions for crypto firms to maintain competitiveness with U.S. regulations.

Citi's forecast anticipates stablecoins supporting up to $200 trillion in annual transactions by 2030 if their velocity mirrors traditional fiat. However, the bank also projects bank tokens-such as tokenized deposits-could surpass stablecoins in transaction volume due to their regulatory safeguards and real-time settlement capabilities. This evolution reflects a broader reimagining of financial infrastructure, where stablecoins, CBDCs, and tokenized assets coexist to enhance efficiency and accessibility.

[1] CNBC (https://www.cnbc.com/2025/10/09/biti-bvnk-stablecoin-banks-crypto.html)

[2] Morningstar (https://www.morningstar.com/news/business-wire/20251009562874/citi-ventures-invests-in-bvnk-to-power-the-next-generation-of-financial-infrastructure)

[3] Cointelegraph (https://cointelegraph.com/news/citi-invests-in-bvnk-stablecoin-infrastructure-expansion)

[4] Cointelegraph (https://cointelegraph.com/news/citi-forecasts-4-trillion-stablecoin-2030)

[7] CoinCentral (https://coincentral.com/bank-of-england-to-allow-stablecoin-holding-exemptions-for-crypto-firms/)