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Spain’s second-largest bank, BBVA, has announced plans to launch its stablecoin in 2025 in partnership with Visa, positioning itself to compete in the $172 billion stablecoin market.
This move positions BBVA as the latest entrant in the increasingly competitive stablecoin market, following the footsteps of other financial giants like Ripple and PayPal.
Francisco Maroto, BBVA’s head of digital assets, revealed in an interview that the bank is presently in the sandbox phase of Visa’s initiative designed to help financial institutions develop their tokenized assets. BBVA aims to transition from prototype to live operations by 2025.
Details On BBVA’s Stablecoin
While specific details about the stablecoin remain under wraps, Maroto mentioned that the bank has yet to decide on the backing for the asset. Options under consideration include money market funds, deposits, or fiat currencies like the U.S. dollar or euro. The primary use case for BBVA’s stablecoin will be as a settlement layer on exchanges.
Maroto highlighted that BBVA’s choice to collaborate with Visa over existing stablecoin solutions was driven by Visa’s robust brand and compliance. Notably, this gives the bank a strategic advantage, especially in Europe, where stablecoin regulations have recently been established.
Accordingly, BBVA’s stablecoin is expected to be primarily euro-based, focusing on settlement for tokenized asset exchanges.
While BBVA’s stablecoin is poised for a 2025 launch, Maroto noted that U.S. operations are not part of the immediate plans. Notably, BBVA has been exploring the digital asset landscape since 2014. Maroto expressed optimism that this venture would allow the bank to capitalize on the burgeoning trend of asset tokenization, including private credit funds and real estate.
Currently, BBVA offers Ethereum, Bitcoin, and USDC custody and trading services in Switzerland for institutional clients and private banking. It plans to expand into Turkey.
Giants in the Stablecoin Market
The stablecoin landscape has grown substantially over the past decade, with dollar-backed options like Tether (USDT) and USDC Coin (USDC) seeing a surge in popularity.
USDT currently boasts a valuation of $119.67 billion, commanding over 50% of the $172.59 billion stablecoin market. USDC, which closely follows, has a market cap of $35.57 billion.
Recent entries from traditional financial entities include PayPal’s PYUSD stablecoin, which was launched in August 2023 and has a market cap of $716.17 million.
Prominent payment firm Ripple is joining the stablecoin market via RLUSD in this last quarter. The RLUSD stablecoin is currently undergoing various operational testing phases.