Bank of America eyes "BofA Coin" stablecoin launch

Bank of America (BofA) is considering launching a USD-backed stablecoin, potentially named "Bank of America Coin," if comprehensive legislation is passed in the United States.

CEO Brian Moynihan indicated that the bank would enter the stablecoin business once it becomes legally permissible.

He suggested the stablecoin would be linked to customer deposit accounts, enabling seamless movement between the "BofA coin" and U.S. dollar deposits.

Moynihan views stablecoins as similar to existing financial instruments like money market funds or bank accounts.

He also highlighted three key areas in the digital asset space: blockchain technology, stablecoins, and Bitcoin (CRYPTO:BTC) and other cryptocurrencies.

Several stablecoin regulatory bills have been proposed by U.S. lawmakers, including the Lummis-Gillibrand Payment Stablecoin Act and the Clarity for Payment Stablecoins Act of 2024.

Federal Reserve Governor Christopher Waller has stated that both banks and non-banking institutions should be allowed to issue regulated stablecoins.

Stablecoins have grown into a $230 billion industry, with major companies like PayPal and Ripple (CRYPTO:XRP) entering the market.

Despite the rise of digital payments, Moynihan emphasised that cash remains "critically important" to the financial system.  

The BofA CEO also stated that the bank’s strategy involves pursuing financial technology innovations while maintaining its physical branch network. 

Stablecoins, which are pegged to the U.S. dollar, have become a widely used financial instrument in the crypto market.