US banks are jumping headfirst into the world of stablecoins as a group of US-backed financial institutions makes plans to mint a new stablecoin.
According to a press release, the “USDF Consortium” will mint a US-dollar pegged stablecoin (USDF) that’s redeemable on a 1:1 basis from any of the consortium’s members.
The USDF Consortium’s founding banks include New York Community Bank, NBH Bank, FirstBank, Sterling National Bank and Synovus Bank.
The fintech company Figure Technologies and the joint venture JAM FINTOP are also partners on the stablecoin project, which will launch on the Provenance Blockchain.
Explains Figure CEO Mike Cagney,
“USDF opens up endless possibilities for the expanding world of DeFi transactions.
The ease and immediacy of using USDF for on-chain transactions was demonstrated this fall when NYCB minted USDF used to settle securities trades executed on Figure’s alternative trading systems.
We are tremendously excited that NYCB expects to be minting USDF on demand and on a regular basis in the coming weeks.”
The USDF stablecoin will be programmed to prevent transfers to wallets without bank-compliant know your customer or anti-money laundering review processes, per the project’s website.
The USDF Consortium also claims their stablecoin will satisfy the recommendations laid out by the President’s Working Group Report on the sector.
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