Twenty-one banks and asset managers just announced they’re forming a company to issue stablecoins. Circle’s stock is down about 6% today, underperforming most crypto-linked stocks. That’s the whole story in two sentences, and it’s the second time this year the market has priced Circle down on a rival that doesn’t exist yet.
The group includes Bank of America, Citi, Goldman Sachs and UBS. It said Tuesday it plans to form a company that will issue stablecoins for payments and digital asset transactions.
The company doesn’t have a name. It’s expected to be established in the second half of the year, subject to closing conditions, the group said in a press release.
The product is 18 months out, minimum
Here’s the part that gets skipped in the headlines. The venture plans to start with a U.S. dollar-denominated stablecoin and bring it to market in the first half of 2027.
That’s a long runway for an entity that hasn’t been incorporated yet. Stablecoins tied to other Group of Seven currencies are meant to follow, with a euro-denominated token as the priority.
So the thing Circle is being punished for today ships, at the earliest, roughly a year and a half from now. Investors aren’t reacting to a product. They’re reacting to a letterhead.
This started with 10 banks and a whitepaper-shaped idea
The project grew out of an initiative announced in October 2025, when 10 banks said they were exploring a digital payment asset backed one-for-one by reserves and available on public blockchains.
Ten became 21 in under a year. That’s the real signal here, more than any technical detail, because the technical details are still thin.
Participants now span North America, Europe, East Asia, the Middle East and Africa. Wells Fargo, Deutsche Bank, Santander, Fidelity Investments, MUFG Bank and Standard Bank are in, alongside other banks and investment firms, according to the press release.
Regulation is the actual pitch
The group said it intends to meet requirements under the U.S. GENIUS Act and the European Union’s Markets in Crypto-Assets framework.
Read that as the differentiator. A consortium of this size isn’t going to win on speed or on chain support. It’s going to win, if it wins, by being the stablecoin a bank compliance desk can approve without a three-month legal review.
Whether that’s enough to move share from an incumbent with years of liquidity is a separate question, and nothing in Tuesday’s announcement answers it.
Tether still owns 60% of everything
The market these 21 institutions are walking into has grown fast. Overall market capitalization for the sector rose from around $200 billion at the beginning of last year to around $303 billion as of press time, according to DeFiLlama data.
U.S.-dollar-backed stablecoins take the lion’s share. Tether’s USDT accounts for 60% of the total.
Circle’s USDC, the second-largest competitor, commands more than 20%. Add those two together and you’ve got better than 80% of a $303 billion market locked up before the new venture writes a line of code.
Circle has been here before, three months ago
June was worse. Circle’s stock took a big hit after more than 140 companies, including Stripe, Coinbase, Visa, Mastercard and BlackRock, announced plans to launch the Open USD stablecoin, seen as a direct rival to USDC.
Now it’s another consortium, another announcement, another day of red. Circle closed at $88.87.
The pattern is worth watching more than any single day’s move. Twice now, a coalition announcement with no shipping product has been enough to knock Circle down, which tells you the market thinks USDC’s moat is distribution, and distribution is precisely what 21 banks and 140 payment companies have on hand.
What to actually watch
Ignore the ticker for a minute and watch the second-half incorporation. If the unnamed company doesn’t get stood up on schedule, subject to those closing conditions, the 2027 launch date slides with it.
And watch which of the 21 commits reserves rather than a logo. A press release with Goldman and Citi on it costs nothing. Backing a token one-for-one with reserves, on a public blockchain, under GENIUS Act and MiCA scrutiny, is a balance-sheet decision. Only one of those has happened so far.
