Four U.S. banks have teamed up to launch a banking alternative to non-bank-issued stablecoins.
Formed by JAM Fintop and Provenance Blockchain Foundation with support from Figure Technologies, the USDF consortium includes founding New York Community Bank (NYCB), NBH Bank, FirstBank, Sterling National, and Synovus Bank.
Under the scheme, U.S. dollars are issued exclusively by U.S. banks and exchanged for cash at the consortium’s member banks at a 1:1 ratio. USDF, available on the Provenance public blockchain, facilitates peer-to-peer and business-to-business transfers.
Banks and their customers can also leverage USDF for various applications, including capital requirements financing, accounting, and supply chain financing.
Figure CEO Mike Cagney said:
“USDF opens up endless opportunities for the expanding world of DeFi trading.” “The ease and speed of using USDF for on-chain transactions was demonstrated this fall when the NYCB issued USDF used to settle securities transactions made on an alternative trading system. It will be the foundation in the coming weeks.”
Figura and the founding bank members will have a representative on the Consortium’s Board of Directors, managing the business, operations, and membership.
Valerie Kramer, Chief Digital Officer, NBH Bank Kramer) said the consortium expects to significantly expand the membership of FDIC-insured banks through 2022 and beyond.
“With the USDF consortium, banks of all sizes, especially public banks, will be We can provide digital banking solutions,” she says. “This is in line with our commitment to building a comprehensive digital finance ecosystem to lower transaction costs for small businesses while providing more access to credit, FDIC-insured custody and financial management solutions, and integrated financial information.”