NYCB and Group of Banks Join to Launch USDF Stablecoin – Bitcoin News

A group of US-based banks are launching their own stablecoin, USDF. The stablecoin will be issued by the USDF consortium, which will allow its members (financial and banking institutions) to issue USDF. The proposed stablecoin will be the first coin of its kind to be minted by institutions insured by the Federal Insurance Corporation (FDIC) and compliant with recommendations regarding the use of stablecoins made by the President’s Working Group.

USDF Alliance to Launch Stablecoin

The USDF Consortium, a membership-based group of banks, is launching the first stablecoin minted by the bank, also called USDF. According to a January 12 press release, the aim of this release is to eliminate friction by addressing “consumer protection and regulatory concerns for non-bank issued stablecoins and offering a more secure option for transactions on the blockchain.”

The USDF union is the entity that will authorize these banks to mint the stablecoin, which will be redeemable 1:1 in cash from any of the aforementioned union banks. The founding members of this consortium include institutions such as New York Community Bank (NYCB), NBH Bank, Firstbank, Sterling National Bank and Synovus Bank. Figure Technologies, Inc. And Jam Fintop is a founding member as well.

Define targeting, payments and adjustments

Stablecoins are a big part of what decentralized finance is all about at the moment, and the USDF consortium is targeting this area with development. CEO Figure Mike Cagney stated:

USDF opens up endless possibilities to expand the world of deFi transactions.

Figure systems have already used USDF to settle securities transactions involving the New York Community Bank. Andrew Kaplan, Head of Digital and Banking Services at NYCB in his capacity as a Service Officer, noted the importance of this launch for the transfer of compatible funds using modern blockchain services. According to the CEO, the goal is to do things “in a way that can scale, adhere to regulatory standards, and be acceptable to all users from large institutional investors to retail clients.”

This is one of the first attempts by a group of banks to propose an alternative solution to stablecoins already on the market, taking into account the recommendations on the use of stablecoins by the President’s working group. Stablecoins have become one of the segments in the crypto industry with significant growth, with a market cap of over $100 billion. USDT, the token issued by Tether, dominates nearly half of the market capitalization in this category.

According to Cagney, New York Community Bank will work on minting the on-demand stablecoin in the coming weeks.

What do you think of the launch of USDF? Tell us in the comments section below.

sergio@bitcoin.com

Sergio Goshchenko

Sergio is a cryptocurrency journalist based in Venezuela. Describing himself as a latecomer, he entered the crypto space when the price spike occurred during December 2017. Because he has a background in computer engineering, lives in Venezuela, and is influenced by the crypto boom on a social level, he offers a different perspective on the success of crypto and how it helps people who They do not deal with banks and the disadvantaged.

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