Wall Street's Stablecoin Push Aims to Reinforce Dollar Dominance

Goldman Sachs Group Inc. (NYSE:GS), Citigroup Inc. (NYSE:C), and Bank of America Corp. (NYSE:BAC) are advancing blockchain-based financial infrastructure through collaborative efforts and regulatory frameworks established by the Trump administration's GENIUS Act. The law, enacted in July 2025, mandates 1:1 reserve backing for stablecoins and permits federally chartered institutions to issue and hold these digital assets under clear oversight Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1]. This regulatory clarity has spurred major banks to develop interoperable digital currencies pegged to G7 currencies, including the U.S. dollar and euro, to streamline settlement systems for regulated financial institutions Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1].

Citigroup's strategic investment in BVNK, a London-based stablecoin infrastructure firm, underscores Wall Street's growing interest in cross-border payment solutions. BVNK's platform, which facilitates fiat-to-digital asset conversions, now exceeds a $750 million valuation, with Citi's backing reinforcing confidence in stablecoins as a tool for global payment modernization Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1]. Citi CEO Jane Fraser has previously outlined plans for a proprietary stablecoin, positioning the bank as an early adopter of private blockchain settlement tokens Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1].

The stablecoin market has expanded to $314 billion in combined market capitalization, driven by Tether's USDT ($178 billion) and Circle's USDC ($75 billion) Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1]. Visa reported nearly $9 trillion in stablecoin transactions over the past year, while analysts at JPMorgan Chase & Co. (NYSE:JPM) estimate that dollar-backed stablecoins could add $1.4 trillion in demand for U.S. dollars by 2027 Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1]. Standard Chartered Plc (LON:STAN) warns that emerging market banks could lose up to $1 trillion in deposits within three years as capital migrates to regulated, dollar-pegged stablecoins amid inflation and currency instability Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1].

The GENIUS Act has also enabled the Trump-affiliated WLFI Group to launch its USD1 stablecoin, signaling a broader shift in Wall Street's digital strategy. By entering the stablecoin market, major banks aim to reclaim ground from fintech firms like Tether and Circle while ensuring compliance within a regulated framework Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1]. Analysts argue that stablecoins may strengthen the U.S. dollar's global role by digitizing access to it, countering de-dollarization narratives Goldman Sachs, Citi, Bank of America To Walk Through The Door Opened By Trump-Backed GENIUS Act^[1].

The market's growth is further supported by institutional adoption. BlackRock, JPMorgan, and Goldman Sachs are piloting tokenized bonds and Treasuries, with projects like Project Yorktown accelerating tokenization of real-world assets. Bloomberg Intelligence projects tokenized assets could reach $16 trillion by 2030, driven by regulatory clarity and technological integration The $16 Trillion Tokenization Era Has Begun | InvestorPlace^[2].