A consortium of 21 major financial institutions has committed approximately $270 million to launch a regulated stablecoin business known as Project Faro [1, 2]. Capital raised for the venture is budgeted to cover five years of operational expenses for the new company, which was first publicly disclosed in September [1, 2].
The banking group includes Goldman Sachs, Citigroup, Banco Santander, Deutsche Bank, Wells Fargo, Fidelity, Mitsubishi UFJ Financial Group (MUFG), Standard Bank, and BBVA [1, 2]. The entity plans to operate as a regulated issuer, with an initial goal of releasing a U.S. dollar-denominated stablecoin in the first half of 2027 [2].
Structure and International Expansion
Project Faro is expected to be incorporated within the United States [1, 2]. While the dollar-backed token is the initial product on the schedule, the venture plans to issue tokens pegged to all Group of Seven currencies [1, 2]. Priority for the second phase is assigned to a euro-denominated asset [1, 2].
The foundation of the project dates back to October 2025, when a group of 10 banks, including France's BNP Paribas, began evaluating a shared issuance structure [2]. Since then, institutional participation has crossed into several overlapping consortia rather than single-vendor commitments [2].
Several members of Faro maintain stakes in competing digital currency initiatives [2]. BBVA, Rabobank, and BNP Paribas are simultaneously involved with Qivalis, a European banking consortium formed to challenge U.S. dollar token dominance [2]. Rabobank joined Qivalis in May 2026 alongside 25 other lenders, bringing that group's total membership to 37 banks [2]. Qivalis received formal authorization as an electronic money institution from the Dutch central bank in October 2026 [2].
In addition, over 140 commercial entities, including Stripe, Visa, Mastercard, and BlackRock, formed the Open USD stablecoin project in June [1, 2]. Participating in multiple groups lets commercial banks evaluate different issuance models while securing access to potential settlement infrastructure [2].
Established Market Leaders
Project Faro enters a sector currently controlled by two major issuers [2]. DefiLlama metrics as of November 10 place total stablecoin market capitalization at roughly $290 billion [2]. Tether's USDT accounts for $176.3 billion of that total, while Circle's USDC represents approximately $70.4 billion [2]. Combined, these two tokens represent about 85% of the active market [2].
Bank-backed initiatives aim to compete by using established corporate relationships rather than building retail crypto distribution networks from scratch [2]. Member banks already handle corporate treasuries, commercial payment networks, and merchant relationships that can serve as direct settlement rails [2].
Regulatory Frameworks and Yield Rules
Regulatory changes in the United States are reshaping stablecoin mechanics [3]. The GENIUS Act takes effect in January, prohibiting stablecoin issuers from paying yield directly to token holders simply for holding the asset [3]. Revenue sharing executed through third-party partners remains subject to evaluation, following guidance published in October by the Office of the Comptroller of the Currency [3].
Interest generation remains a central point of competition between token structures [3]. Real-world asset stablecoins backed by private credit currently sustain yields between 5% and 7%, while native crypto funding rates sit near 4% [1]. Market estimates project the total addressable market for off-chain yield stablecoins to reach $4 billion over three years [1].
Because conventional reserve-backed stablecoins collect interest on underlying assets without distributing returns to end users, corporate treasuries are evaluating whether standard stablecoins or bank-backed deposit tokens fit their operational requirements [3].
Tokenized Deposits and Infrastructure
Alongside shared stablecoin consortia, individual lenders are testing tokenized bank deposits [3]. Tokenized deposits represent commercial bank deposits recorded on a blockchain, giving them programmable transfer logic while retaining direct deposit insurance claims [3]. A research paper by Capgemini and Quant noted that banks can support round-the-clock transfers using tokenized deposits without replacing their underlying core banking software [3].
JPMorgan Chase has deployed its JPM Coin deposit token on the Base network and plans to expand the asset to Ethereum [3]. Holdings remain restricted to vetted corporate clients that satisfy bank verification requirements [3].
Inter-bank settlement systems are also undergoing regional testing [3]. In the United Kingdom, seven commercial banks completed live pilot transfers using tokenized British pound deposits through the Great British Tokenized Deposit initiative [3]. In Germany, the Commercial Bank Money Token initiative finalized its initial live inter-bank payments in May [3]. In the United States, 25 banking institutions are working with The Clearing House to construct a shared tokenized deposit clearing network [3].
Crypto-native firms are simultaneously seeking licensed banking access [3]. Payward, the parent company of exchange operator Kraken, agreed to buy Lithuania-licensed Saldo Bank in a deal expected to close in 2027 subject to regulatory approval [3]. That deal follows Kraken Financial becoming the first digital asset bank to receive a Federal Reserve master account in March [3].
Project Faro plans to complete its U.S. incorporation and launch its first dollar-backed stablecoin in the first half of 2027, following the statutory implementation of the U.S. GENIUS Act rules in January [2, 3].
Sources
- CoinDesk, "Goldman Sachs, Citi among banks said to commit $270 million to stablecoin venture", https://www.coindesk.com/business/2026/11/10/goldman-sachs-citi-among-banks-said-to-commit-usd270-million-to-stablecoin-venture
- Cointelegraph, "Global banks commit $270M to stablecoin venture targeting 2027 launch", https://cointelegraph.com/news/banks-270m-project-faro-stablecoin-2027
- CoinDesk, "Will stablecoins survive once the banks catch up?", https://www.coindesk.com/opinion/2026/11/10/will-stablecoins-survive-once-the-banks-catch-up
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