Banks Turn Stablecoin Safety Into a Selling Point

Traditional financial institutions (FIs) already possess traits corporate treasurers value: regulated custody, established payment infrastructure, treasury services and long-standing client relationships. If those services become the operating center for institutional stablecoins, banks could occupy a pivotal position without necessarily putting their own tokens into circulation.

That possibility received fresh support with BNY’s June announcement that it had expanded its relationship with Circle. Under the arrangement, institutional clients can hold USDC on BNY’s Digital Asset Custody platform while also instructing Circle to mint and redeem tokens through the bank.

The announcement also reflects a broader pattern emerging from PYMNTS Intelligence research. Corporate finance executives continue to separate stablecoins from the broader cryptocurrency market.

According the “Stablecoins Gain Ground: Why CFOs See More Promise There Than in Crypto” report, 42% of middle market companies have discussed, tested or used stablecoins, compared with 30% that have done the same with cryptocurrencies. Yet only 13% report using stablecoins today, while just 5% report live cryptocurrency usage. The figures suggest that stablecoins have crossed onto the institutional agenda without becoming standard operating practice.

The research found that firms using stablecoins gravitate toward bank-connected access instead of direct digital wallets. Twelve percent reported accessing stablecoins through bank-integrated solutions, compared with 8% through treasury or payments FinTechs and just 5% through self-custody wallets. That preference suggests corporate finance departments remain more comfortable adopting digital assets through institutions that already manage cash, liquidity and treasury operations.

The same study found that regulation continues to outweigh technology as the principal obstacle. Sixty-seven percent of CFOs cited regulatory or compliance uncertainty as a barrier to stablecoin adoption, while 43% pointed to integration with existing financial system. Custody, governance and operational controls remain just as important as blockchain capabilities.

Another result points in the same direction. Companies using stablecoins rarely treat them as treasury assets. Eighty-eight percent convert stablecoins received into U.S. dollars immediately, indicating that most firms view them as payment infrastructure rather than balance sheet investments..

Custody as an Operating Layer

Custody has become a central policy issue alongside stablecoin legislation. Stablecoin custody requires customer assets and reserves to be separately accounted for and segregated from a custodian’s own assets. Regulations also established customer priority over other creditors with respect to payment stablecoins held in custody, while permitting omnibus accounts under prescribed conditions and allowing insured depository institutions to hold stablecoin reserves in the form of cash deposits.

Those safeguards address questions that corporate treasury departments routinely ask before adopting a new financial instrument. Who holds the asset? How is ownership documented? What happens if the custodian fails? Can the asset fit within existing treasury controls, audit requirements and regulatory obligations?

If a multinational company already entrusts a bank with its operating cash, securities custody, liquidity management and payment processing, does it make sense to place stablecoin custody with another provider? For many treasury organizations, consolidating those responsibilities could simplify governance, reduce reconciliation work and place digital assets within familiar control environments.

The answer will depend on regulation, product development and economics. It also will depend on whether banks can connect tokenized assets to treasury systems without forcing finance teams to redesign internal processes. The PYMNTS Intelligence findings suggest that those operational considerations weigh heavily on adoption decisions. Executives continue to cite regulatory clarity and integration with existing financial systems as the principal hurdles, while bank-connected access remains the preferred method for firms that already use stablecoins.