TradFi giant State Street Corp. is XEM launching its own stablecoins and Tokenize deposits to enhance payments capabilities using blockchain technology, Bloomberg News reported on July 17.
Sources told the news agency that these initiatives are aimed at leveraging the company's investment in UK-based payments startup Fnality and joining "consortium efforts digital currency” more broadly.
This potential move would mark a significant leap for State Street, which has been gradually integrating into the crypto space, primarily Vai as a fund manager for the launched Spot Bitcoin ETFs . at the beginning of the year.
Digital expansion
State Street is also evaluating the digital currency group's engagement efforts and exploring payment options through its investment in Fnality, which is looking to expand into the United States.
Fnality, which focuses on blockchain-based payment solutions, is considered a key element in State Street's strategy to streamline global payments processes.
The report added that State Street is increasing its digital asset development efforts.
Earlier this year, the company integrated its digital assets team into its overall business, aiming for closer integration between traditional finance and digital assets.
The company also provides fund management and accounting services for Spot Bitcoin ETFs and has expanded its digital asset initiatives through a partnership with Galaxy Asset Management to develop Digital asset ETF amid growing demand.
In the coming months, State Street plans to focus on Tokenize assets such as money.
A recently published digital assets survey of 300 institutional investors by the firm found that nearly half of respondents are willing to trade digital assets on and off Distributed Ledger and blockchains. , provided they have the right infrastructure.
TradFi's growing interest
The company's interest in blockchain is part of a broader trend among financial institutions to modernize and streamline payment processes through digital assets.
JPMorgan Chase & Co. has been at the forefront of blockchain technology for many years, following the launch of the Onyx blockchain and stablecoin, JPM Coin, in 2020.
The bank continues to expand its blockchain initiatives with the Tokenized Collateral Network in 2023, enhancing programmable payments.
Similarly, Goldman Sachs started trading digital bonds on the blockchain in 2021, showing growing confidence in digital assets in the traditional finance sector.
This trend is not limited to banks, with PayPal launching stablecoin PYUSD in August 2023, while BlackRock ventured into asset Tokenize with a digital liquidation in March after launching Spot The most successful Bitcoin ETF.
Token of deposits, which is the digital representation of bank deposits, has also attracted the attention of traditional financial companies.
The Monetary Authority of Singapore's Project Guardian, launched in 2022, sees JPMorgan as a key player, further developing the technology for its own applications.
These developments highlight the widespread acceptance of digital assets in mainstream finance.
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