Major U.S. banks have initiated pilot programs in collaboration with Coinbase, focusing on the testing of stablecoins, custody services, and trading capabilities. This strategic move is part of a larger initiative to transition towards on-chain settlement processes. Coinbase CEO Brian Armstrong disclosed these developments during an appearance at the New York Times DealBook Summit, where he shared the stage with BlackRock CEO Larry Fink.
Banks Transition from Experiments to Live Pilots
Armstrong confirmed that several prominent banks are currently engaged in live testing, integrating stablecoins and direct cryptocurrency services into their existing internal systems. His remarks highlighted a significant shift within the traditional finance sector, moving from preliminary research phases to operational pilot programs. This evolution comes after years of market uncertainty that previously hindered such advancements.
He stated that leading financial institutions view these digital tools as integral components of their long-term modernization strategies. Armstrong also noted that while some institutions continue to resist change through lobbying efforts, their innovation departments are actively developing new solutions. This internal tension reflects a dichotomy within major financial firms, balancing the preservation of legacy profit margins with the pursuit of accelerated digital settlement capabilities.
Stablecoins Gain Traction in Corporate Finance
This internal drive is complemented by increasing demand from corporate clients seeking more efficient settlement methods. Stablecoins, collateralized by cash or short-term U.S. Treasury securities, are emerging as the primary entry point for banks exploring tokenized finance. These tokens provide direct dollar exposure and facilitate instant transferability, making them well-suited for treasury operations and cross-border payment experiments.
According to Armstrong, the global stablecoin market has the potential to reach $1.2 trillion by 2028. Citi, which has also conducted stablecoin payment trials with Coinbase, projects a more optimistic scenario of a $4 trillion market by 2030. These forecasts are consistent with ongoing global initiatives such as JPM Coin and Citi's tokenized deposit offerings, all of which underscore a sustained interest in on-chain settlement solutions.
Larry Fink echoed the sentiment that the United States is lagging behind countries like India and Brazil in financial innovation. He cited Brazil's Pix system as an example of a widely adopted platform that already supports cryptocurrency payment integrations. This comparison positions the U.S. pilot programs as part of a broader global race in financial technology, driven by international competition and evolving customer expectations.
Market Dynamics and Regulatory Landscape
These pilot initiatives are proceeding amidst a period of market volatility, with many digital assets experiencing declines in October and November. Armstrong indicated that these price fluctuations do not impact the strategic outlook of the participating banks.
He asserted that financial institutions now perceive cryptocurrency infrastructure as a core business line rather than a speculative side venture. Concurrently, Armstrong urged lawmakers to advance the CLARITY Act, legislation designed to establish clear definitions for market structure, token issuers, and trading responsibilities within the digital asset space.
He emphasized the necessity of predictable regulatory frameworks for banks undertaking the integration of digital assets, citing the operational risks involved. While the House of Representatives has advanced related bills, the Senate has yet to schedule a vote. Larry Fink provided further context on the role of Bitcoin during the summit.
Fink characterized Bitcoin as an asset that investors turn to during times of physical or financial instability. He stated that BlackRock recognizes a "big, large use case" for Bitcoin, noting that his initial skepticism has evolved since the introduction of their Bitcoin ETF. Armstrong concurred, expressing strong confidence that the asset's value will not diminish to zero.
Banks Strategize Ahead of 2026 Rulemaking
These developments align with projections that federal guidance for stablecoins and tokenized settlement will become more robust throughout 2025 and continue into 2026. Banks are proactively positioning themselves to avoid falling behind agile fintech firms and international competitors that are already operating large-scale tokenization pilots.
Armstrong highlighted regulatory advancements, such as the Genius Act passed in July 2025, as instrumental in clarifying stablecoin requirements. He expressed optimism that the U.S. is now regaining momentum as regulatory clarity improves, while acknowledging that further steps are needed to ensure predictable operations for both banks and cryptocurrency exchanges.
The engagement of major U.S. banks in stablecoin pilots with Coinbase signifies a crucial shift from research and development to practical implementation. This trend reflects increasing corporate demand, intensifying global competition, and the anticipation of more stringent federal regulations. The ongoing activity underscores the evolving nature of banking infrastructure, moving towards on-chain systems as institutions prepare for broader adoption of digital assets.