U.S. Bank has begun testing custom stablecoin issuance on the Stellar blockchain, marking one of the most progressive moves yet by a major U.S. financial institution toward programmable digital money.
.@usbank is testing custom stablecoin issuance on the Stellar network.
Real infrastructure testing for regulated deposit tokens — the kind that could reshape how banks move money.
Here's what’s happening.https://t.co/C7sqTIDJZF pic.twitter.com/ZFXC5Q1a49— Stellar (@StellarOrg) November 25, 2025
The development was announced during the bank’s Money 20/20 podcast episode, The Tokenized Future of Banking, featuring leaders from U.S. Bank, SDF, and PwC discussing how tokenization will reshape the future of financial services.
The initiative shows a growing shift among major financial institutions toward programmable money—digital assets built with safeguards and compliance features required by traditional banking.
Why U.S. Bank Chose Stellar for Stablecoin R&D
During the podcast, Mike Villano, Senior Vice President and Head of Digital Asset Products at U.S. Bank, emphasized that safety and control are non-negotiable when bringing tokenized assets into the banking environment.
“For bank customers, we have to think about protections around know-your-customer, the ability to unwind transactions, the ability to claw back transactions,” Villano said.
“One of the great things about the Stellar platform, as we did more research and development on it, was learning that they have the ability at their base operating layer to freeze assets and unwind transactions,” Villano added.
Stellar says its architecture was built specifically for issuing assets and moving money at scale. With 99.99% uptime over more than a decade, fast 3–5 second settlement, and transaction fees that cost a fraction of a U.S. cent.
Institutional Confidence in Stellar’s Reliability
José Fernández da Ponte, President and Chief Growth Officer at the Stellar Development Foundation, pointed out that institutional-grade reliability is the foundation of Stellar’s appeal.
“When you are doing mission-critical systems, when you are doing financial services, and you are moving consumers’ money, you need to make sure that your blockchain is going to be there,” he said. “We are honored to have the confidence of U.S. Bank and our partners at PwC. We take that confidence and that trust very, very seriously,” said Villano.
ECB Warns Stablecoins Are Rising Fast With Spillover Risks
On Monday, the European Central Bank (ECB) warned that the rapid expansion of stablecoins—despite their still-limited footprint in the euro area—poses emerging financial-stability risks, especially as interlinkages with global markets deepen.
The findings come from the ECB report “Stablecoins on the rise: still small in the euro area, but spillover risks loom,” prepared by Senne Aerts, Claudia Lambert, and Elisa Reinhold, which examines structural vulnerabilities, use cases, and cross-border risks tied to the accelerating stablecoin ecosystem.
According to the authors, the combined market capitalisation of all stablecoins has surged past $280 billion, reaching an all-time high and accounting for roughly 8% of the total crypto-asset market. Two U.S. dollar-denominated stablecoins dominate overwhelmingly: Tether (USDT) with $184 billion and USDC with $75 billion.
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