Hey, it's Marc.
Citi called stablecoins clunky. Citi backs one anyway.
What's happening: On their third-quarter calls last Tuesday, Citi, Wells Fargo and Goldman Sachs all talked up tokenization, and Citi and Wells pushed bank tokens in particular: ordinary deposits recorded on a blockchain, so they move at any hour. Citi's Jane Fraser said Citi Token Services runs in seven markets and plugs into a 24/7 clearing network that reaches 300 banks. Wells Fargo said its tokens went live last month.
All three played stablecoins down. Yet all three are among 21 firms planning a shared dollar stablecoin for the first half of 2027.
A bank token, or tokenized deposit, is a normal bank deposit on a blockchain. It stays the bank's IOU.
A stablecoin is an IOU from a separate company, backed mostly by Treasury bills.
Move $1 million from a Citi account into a stablecoin and Citi loses $1 million of funding. Move it into a Citi token and Citi keeps it.
US law lets banks pay interest on deposits. The GENIUS Act bars stablecoin issuers from paying any.
Volumes are tiny so far. Nothing on these calls moved a bank's numbers.
Why it matters: Most people will read these calls as Wall Street going all-in on tokenization and saying no to stablecoins. We think that misses it. A bank token keeps the deposit. A stablecoin moves it. The banks are building both, so that every digital dollar ends up back in a bank.
