Stablecoin: Not Ready for Prime Time Yet but Their Time Is Coming

Why community financial institutions should start preparing now for the stablecoin era

At every fall banking and fintech conference this year, one topic keeps coming up: stablecoins and how community financial institutions should approach them.

The question for community financial institutions (CFIs) isn’t if  they’ll play a role in digital assets, it’s how. Even limited experimentation today helps institutions build the knowledge and infrastructure for future opportunities that they’ll need to compete when digital assets go mainstream.

In this article, I’ll outline where stablecoins stand today, the key challenges holding them back, and practical ways for community financial institutions to engage, without taking on unnecessary risk.

“Stablecoins may not be ready for prime time yet, but the evolution is accelerating. The smartest move for community banks is to start engaging early: to learn, prepare, and position for what’s next.”
— Andrew Dillard, Chief Business Officer, Acceleron

Why standing still isn’t an option

Without a clear strategy for engaging with stablecoins, banks risk losing relevance in core activities such as custody, payments, and clearing.

While some institutions focus on the risk of deposit flight due to potential interest-bearing stablecoin accounts, corporate treasurers are focused on a more immediate pain point, which is the plumbing problem: fragmented infrastructure that slows payments, complicates reconciliation, and limits liquidity.

“Now vs. soon” problem: stablecoin risks holding back adoption

Before stablecoins can become part of everyday banking, a few structural and trust barriers need to be addressed. These issues define the gap between where the technology is today and what’s required for institutional-scale adoption.

Reversibility: Stablecoin transactions are final. Once a payments is sent, there are no callbacks and no reversals. For corporate treasurers, that limits trust and slows adoption.

Insurance: Stablecoin deposits lack FDIC protection, which keeps bank deposits the safer option for now.

Rewards: Stablecoin issuers are exploring ways to pay interest on reserves. They current offer customers “rewards” at rates that compete with bank interest. That’s a challenge for banks, as it could pull deposits from traditional accounts into digital wallets.

Three paths for banks to engage stablecoins

CFIs have three main strategies for entering the stablecoin ecosystem:

1. Issue your own stablecoin
   Banks that issue their own stablecoin retain full control and the full economic benefit from interest on reserve holdings. However, the tradeoff is significant: this path requires heavy investment in regulatory compliance, technology, and liquidity management.
2. Support an existing regulated stablecoin
   By working with established issuers (like Circle or Paxos), banks can enter the market quickly, access existing liquidity, and lower operational risk. The downside: the issuer typically keeps most of the economic upside.
3. Join a stablecoin network
   Collaborating within shared infrastructure provided by trusted bank cores, such as Fiserv’s FIUSD or FIS partnership with Circle, offers interoperability, regulatory compliance, and shared economics as the network grows.

For most institutions, joining a regulated network strikes the best balance between cost, control, and opportunity.

Stablecoins now vs. tokenized deposits later

Many banks are waiting for “tokenized deposits” — blockchain-based representations of commercial bank liabilities — to mature before engaging.

That’s a long wait. Tokenized deposits remain largely conceptual, with no scalable framework or regulatory clarity yet. Stablecoins, on the other hand, are live, liquid, and moving billions daily.

A prudent approach: experiment with stablecoins today while preparing for tokenized deposits tomorrow. Waiting risks letting fintechs and big banks capture market share and customer relationships first.

Solving the “plumbing” problem

The biggest hurdle to corporate adoption is fragmented infrastructure. The same stablecoin can behave differently depending on which blockchain it sits on, whether it’s Ethereum, Solana, or otherwise, creating operational headaches and risk.

Banks can turn this challenge into an advantage by investing in infrastructure that supports consistent, interoperable settlement across blockchains.

Prioritize interoperability: Build systems that connect multiple blockchains and settlement networks, simplifying treasury operations and risk management.

Establish a foundation: Investing in digital asset infrastructure today provides a foundation for future opportunities like programmable payments, tokenized lending, and cross-border settlements.

Leverage partnerships: Banks don’t need to start from scratch. Partnering with regulated blockchain infrastructure providers can accelerate time-to-market while maintaining compliance and security.

The stablecoin question isn’t if — it’s how.

By engaging now, community financial institutions can strengthen their role in the evolving global financial ecosystem, capture new sources of transaction revenue, and shape the future of a dollar-backed digital economy.  Acceleron views stablecoins as one additional payment rail that complements international wires.  We are actively working on innovative solutions to allow CFIs to engage with this new digital asset economy safely. Please contact us to discuss.

Acceleron is a modern correspondent banking technology platform that empowers community banks and credit unions to automate international wire transfers, capture non-interest income, and compete more effectively with big banks. With a foreign exchange (FX) marketplace and currency conversion engine, Acceleron’s API-first infrastructure helps institutions turn cross-border payment flows into efficient, revenue-generating opportunities. Serving over 200 financial institutions and facilitating more than $1 billion in international payments annually, our correspondent banking services and international payment automation solutions are pre-integrated seamlessly with Fiserv Payments Exchange, Aptys, Braid, and other leading payments platforms.  

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