U.S. Bank Tests Its Own Stablecoin on Stellar

The bank is testing the custom issuance of its own stablecoin on the Stellar network. 

This move matters. It signals that blockchain is no longer just for startups or crypto natives. Large institutions are now picking networks that can handle real money, real users, and real regulations.

Why Stellar Appeals to Big Institutions

Stellar was designed for payments and asset transfers, which makes it a natural fit for banks. One key reason is reliability. The network has maintained more than 99.99 percent uptime, meaning it is almost always available. For banks that settle billions of dollars, downtime is not an option.

Cost is another major factor. Transactions on Stellar typically settle for less than one cent. That is a big deal compared with traditional cross border payments, which can cost several dollars and take days. On Stellar, settlement usually happens in seconds.

Stellar also includes built in asset controls. These tools allow issuers like banks to freeze assets, reverse transfers in limited cases, and meet compliance rules. In simple terms, it helps institutions follow laws around money movement, identity checks, and reporting.

More About Stellar

Stellar’s stablecoin market cap has grown sharply over the past year, rising 53% year over year from $159 million to $243.6 million. Much of this growth was driven by PayPal’s decision to launch its PYUSD stablecoin on the Stellar network in September, bringing a major global payments brand into the ecosystem.

At the same time, USDC also expanded its presence on Stellar, posting a 45% year over year increase in market cap to $223.1 million. Together, these gains highlight rising demand for fast, low cost stablecoin transfers on Stellar and reinforce the network’s growing role as an institutional grade settlement layer.

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