Santander Explores Stablecoin Launch for Retail Clients

Coin WorldThursday, May 29, 2025 4:44 pm ET
2min read

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SA, a prominent global banking institution, is exploring the possibility of expanding its crypto services to retail clients and potentially launching a stablecoin product. The stablecoin plans are still in the early phases, with the bank considering offering both dollar and euro-pegged fiat tokens. This move is part of a broader strategy to provide retail access to cryptocurrency services through its digital banking unit, Openbank.

Openbank has recently applied for licenses to offer crypto services under the European Union's new regulatory framework, known as the Markets in Crypto-Assets Regulation (MiCA). This regulatory framework aims to provide a clear set of rules for crypto-asset service providers, ensuring consumer protection and market integrity. The stablecoins that Santander is considering could serve as a bridge between digital assets and the traditional financial system. Stablecoins are designed to mirror the value of stable currencies, such as the USD, or a basket of assets, providing a digital alternative to cryptocurrencies that are often associated with high volatility. This makes stablecoins more suitable for everyday transactions.

The bank's plans to issue stablecoins come at a time when the stablecoin market has seen significant growth. Stablecoins have become popular among consumers and businesses, particularly in economies with weaker currencies, where dollar-pegged tokens have been adopted. Santander, with its expansive customer base in Latin America, could benefit from offering stablecoins to its clients in these regions. Openbank, which operates in Spain and other European Union countries, including Portugal, the Netherlands, and Germany, is eyeing the launch of crypto services as early as next year, pending regulatory approvals. The bank's move into the stablecoin market and retail crypto services is a strategic step towards staying competitive in the rapidly evolving digital asset landscape.

Santander's consideration of stablecoin issuance follows the advancement of regulatory frameworks and legislative efforts in various regions. The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act in the US Senate, for example, aims to modernize payment rails and ensure the country remains at the forefront of financial innovation. This bipartisan bill, sponsored by several senators, highlights the growing interest in stablecoins and their potential to transform the financial system. Proponents of stablecoins argue they are a way to extend US dollar dominance, increase the velocity of capital in payment systems, bank the unbanked, and expose small businesses to global capital markets.

However, the banking industry remains divided on stablecoins. Although several large banking conglomerates and financial services are mulling issuing dollar-pegged stablecoins, others in the banking industry are opposed to the proliferation of such assets. Banking lobbyists and their allies in the US Senate attempted to

stablecoin legislation over fears that the digital fiat tokens will erode banking profits and steal market share from the legacy financial system. Yield-bearing stablecoins were a significant concern raised by the banking lobby and some US lawmakers. “Do you want a stablecoin issuer to be able to issue interest? Probably not, because if they are issuing interest, there is no reason to put your money in a local bank,” US Senator Kirsten Gillibrand said at the DC Blockchain Summit in March 2025. The senator noted that households and small businesses depend on these banking institutions for loans, and that yield-bearing stablecoins could undermine the retail lending market.

New York University (NYU) professor Austin Campbell recently outlined why the legacy banking sector is fearful of yield-bearing stablecoins. Campbell said that offering consumers rewards in the form of yield disrupts the low-to-no-interest depositor account model at the heart of the fractional reserve system and modern retail banking. Campbell was critical of lawmakers pushing regulations restricting the issuance of yield-bearing stablecoins. “The only people who benefit are billionaires and bank executives,” Campbell wrote in a May 21 X post. Despite these concerns, Santander's move into the stablecoin market and retail crypto services is a strategic step towards staying competitive in the rapidly evolving digital asset landscape. By offering stablecoins and crypto services, Santander aims to provide its clients with a seamless and secure way to participate in the digital economy.