U.S. Bank said Wednesday it completed a live cross-border payment between its North American and European entities using USBDC, a dollar-backed stablecoin the bank issued on Stellar.
A federally regulated U.S. bank issuing its own token on a permissionless chain puts bank money on the same rails as USDT and USDC. U.S. Bank said the pilot kept in place the kinds of controls a supervisor would expect, including tests of minting, freezing, clawback and payment redemption.
Settlement on Stellar, tied to bank systems
The bank said the transaction settled on Stellar while staying connected to its core finance, risk, compliance and operations systems. It also said the pilot validated its internally developed Digital Asset Platform, which issues and moves tokenized assets and links the bank’s existing infrastructure to blockchain networks.
“This live pilot demonstrates our ability to accelerate global cash management and money movement capabilities,” said Gunjan Kedia, chairman and chief executive officer at U.S. Bank.
Key details were not disclosed
U.S. Bank did not say how much money moved, whether USBDC will be offered to clients, what backs the token, or where the reserves sit. According to the release, use cases still under review include liquidity management, collateral mobility and cross-border treasury operations.
“Our focus remains on delivering solutions that solve real client challenges while maintaining the safety, security and reliability that clients expect from U.S. Bank,” said Jamie Walker, head of digital assets and money movement at U.S. Bank.
Another institutional win for Stellar
Stellar has been adding this kind of client. The Defiant reported in August that real-world asset balances on the network had been growing faster than its DeFi markets. Nora Wahlbrink of Breakwater Strategy, who circulated the release on Stellar’s behalf, said U.S. Bank now joins Franklin Templeton and DTCC in building on the network. The Defiant also reported that 21 financial institutions committed to a joint stablecoin venture last week.
According to CoinGecko, XLM traded at $0.1828 on Thursday, down 3.1% over 24 hours and up 4.9% on the week, with a market value of $6.37 billion.