Haciyev Reşit 
One of the leading banks in the United States, U.S. Bancorp, has taken a major step in its digital asset strategy by announcing that it has begun stablecoin testing on the Stellar (XLM) blockchain. According to Bloomberg, this development is central to the bank’s expanding digital finance vision and further confirms the growing interest of traditional financial institutions in blockchain-based payment infrastructures.
U.S. Bancorp Begins Stablecoin Testing on Stellar
The Minneapolis-based banking giant recently established a new division dedicated to digital assets and blockchain-based money transfers. The stablecoin tests launched within this framework indicate that the bank aims to take a more active role in blockchain-powered payment and transfer systems in the future.
Mike Villano, head of digital asset products at U.S. Bank, noted that Stellar’s “asset freeze” feature—designed specifically for institutional structures—played a decisive role in their evaluation. This feature allows institutions to freeze on-chain assets when necessary, providing major advantages in terms of regulation, security, and risk management.
The Stablecoin Race Among Major Banks Is Accelerating
U.S. Bancorp’s move comes at a time when traditional financial giants are increasingly entering the stablecoin space. Stablecoins—digital assets backed 1:1 by cash reserves and short-term U.S. Treasuries—have gained significant attention for enabling fast and low-cost global transfers.
Recent developments highlight rising institutional demand:
- Citigroup choosing Coinbase as a stablecoin partner
- JPMorgan expanding usage of its blockchain-based JPM Coin
- Accelerated regulatory discussions for U.S. stablecoin frameworks
U.S. Bancorp also announced last month that it is working in two major areas: crypto asset custody services and stablecoin-based payment solutions. However, CEO Gunjan Kedia stated that demand on the payments side is still limited, whereas the bank sees much greater potential in custody and asset management services.
Why Is the Stellar Network Attractive for Institutions?
The Stellar blockchain stands out for its architecture designed specifically for financial transactions and tokenization. Key advantages it offers institutions include:
- Asset freeze and account control mechanisms
- Low transaction fees
- High speed
- Compliance-focused tools
Because of these features, Stellar is actively used by major financial institutions such as Circle (issuer of USDC) and Franklin Templeton. According to the Stellar Development Foundation, the network processed $32 billion in payments last year and reached 9.8 million unique wallets as of September—showing increasing institutional adoption.
Overall Assessment
U.S. Bancorp’s decision to begin stablecoin testing on the Stellar network is considered a critical milestone for both the bank’s digital asset vision and the institutional future of blockchain-based finance. The bank’s preference for Stellar’s security and control mechanisms demonstrates that major financial institutions now see blockchain not merely as a theoretical option but as a solution actively being tested. This move could intensify competition within the stablecoin market and accelerate the integration of traditional banks into the digital asset ecosystem.
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