MARKET INSIDER – Citi, one of Wall Street’s leading financial institutions, has cemented its commitment to the digital asset space by investing in stablecoin infrastructure startup BVNK. The undisclosed funding, made through the bank’s venture capital arm, Citi Ventures, signifies a broader trend of major U.S. banks ramping up their presence in cryptocurrency and digital assets as the regulatory environment becomes more favorable.
BVNK’s core technology functions as a global payments rail, enabling customers to seamlessly facilitate transactions in stablecoins—a type of digital asset pegged to a fiat currency and backed by real-world assets like bonds. This infrastructure allows for the movement of money from fiat into stablecoins, and back again. The firm’s co-founder, Chris Harmse, confirmed that BVNK’s current valuation is now higher than the publicly disclosed $750 million from its previous funding round.
The Rise of Stablecoin Payments
Once primarily a trading tool for quickly moving in and out of volatile cryptocurrencies like Bitcoin, stablecoins are now being recognized as a critical solution for cross-border transactions due to their speed, low cost, and 24/7 settlement capabilities.
The market scale is massive: Visa data shows nearly $9 trillion worth of stablecoin transactions occurred over the last 12 months, with the total valuation of all stablecoins in existence currently exceeding $300 billion, according to Coinmarketcap.
For BVNK, the U.S. has emerged as its fastest-growing market over the past 12-18 months. Harmse attributes this surge to increased regulatory clarity, specifically citing the passage of the GENIUS Act, a bill designed to regulate the U.S. stablecoin market.
“You are seeing with the GENIUS Act coming through, and regulatory clarity, an explosion of demand for building on top of stablecoin infrastructure,” Harmse said.
The investment reflects Citi’s strategic intent to bolster its own cross-border payment services. As Harmse noted, U.S. banks “are putting their weight behind… investing in leading businesses in the space to make sure they are at the forefront of this technological shift in payments.” BVNK’s platform can be used by customers to pay international suppliers and contractors, and the company is even targeting neobanks that may use stablecoins for core checking accounts.
A Wider Industry Shift
Citi’s investment is part of a larger movement among global financial giants embracing digital assets. This year, Citi CEO Jane Fraser signaled the bank’s interest in the sector, mentioning that the company is considering issuing its own stablecoin and exploring crypto custodian services.
Other major financial institutions are making similar moves:
- JPMorgan Chase launched its own stablecoin-like token, JPMD, this year and now allows clients to buy Bitcoin.
- Bank of New York Mellon is exploring “tokenized deposits,” a process of issuing a digital token that represents an underlying asset.
- HSBC has already launched its own tokenized deposit service.
The entire banking sector is looking to leverage blockchain technology—originally developed for Bitcoin—to lower costs and accelerate various transactions.
BVNK, also backed by investors like Coinbase and Tiger Global, faces stiff competition from newcomers like Alchemy Pay and established players like Ripple. Despite operating in a competitive landscape, the firm, which has “dipped in and out of profitability” while investing in growth, is on track to become profitable next year.
