Major US banks join forces to create stablecoin

The Wall Street Journal (WSJ) reported on the 22nd (local time) that major Wall Street banks in the U.S. are joining forces to discuss ways to jointly issue stablecoins.
Representative global banks such as JP Morgan Chase, Bank of America (BofA), Citigroup, and Wells Pago are reported to be participating in the discussions. The discussions are still in the early stages.
However, if it is implemented in earnest, it is expected to have a significant impact on the financial market. Such a move will raise the level of banks' reaction to the rapidly growing virtual currency industry, especially the stablecoin market.
Stablecoins are digital currencies whose value is pegged to assets such as the US dollar or gold in order to minimize price volatility.
They act as a "digital dollar" to buy currency and temporarily store assets safely in the volatile cryptocurrency market. Banks say stablecoins are much more cost-effective than traditional financial systems.
It is expected that stablecoins will enable international remittances and inter-company payment settlements, which usually take several days, to be completed in almost real time.
Banks are also concerned that if big tech companies and large distributors issue their own stablecoins and enter the financial market, existing banks' deposit and transaction fee revenues will decrease.
The banks are considering a cooperation model through jointly owned payment service companies Early Warning Services and Clearing House.
Currently, the stablecoin market is led by cryptocurrency companies such as Tether and Circle, and the market size is estimated to be around $245 billion.
If large banks enter the market, it will put a lot of pressure on existing operators. However, the final decision may change depending on various variables such as related regulations, market demand, and security issues.
Banks are taking the position that they will first carefully consider whether there is sufficient market demand for their stablecoins. In addition, due to the nature of digital assets, they are vulnerable to security risks such as hacking.
Security issues and ensuring technical stability are important issues.