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An important step has been taken in the field of crypto money in the USA. With government officials voicing their concerns about stablecoins pegged to the US dollar at every opportunity, a group of US banks has come to the conclusion of issuing a stablecoin. As Kriptokoin.com , we provide the details…

Cryptocurrency move from US banks

A number of US banks are promoting consumer protection and non-bank formed a group to offer self-created, fully regulated stablecoins to address regulatory concerns about stablecoins. The group called USDF Consortium, which became operational on January 12, is an association of financial institutions insured by the Federal Deposit Insurance Corporation (FDIC).

According to the announcement, founding members of the consortium include New York Community Bank (NYCB), NBH Bank, FirstBank, Sterling National Bank and Synovus Bank. Several fintech firms are also part of the group, as they will facilitate the promotion and adoption of the new stablecoin. Cryptocurrency named USDF; It is a bank-issued stablecoin that aims to compete with existing privately issued stablecoins such as Tether (USDT) and Circle’s USDC. The new stablecoin will only be minted by US banks and can be redeemed for cash from member banks on a 1:1 basis.

The intent is cited as the consortium to offer “more consumer protection” compared to unregulated stablecoins. USDF will run on the public Provenance Blockchain, an enterprise proof-of-stake (PoS) network launched by the San Francisco-based Provenance Foundation in May 2021. The question of whether there will be reserves behind the USDF, let alone the FDIC insured institutions, remains unclear. Nor was it specified how many stablecoins will be issued in the first place or when it will be made available to users who must comply with customer recognition/money laundering procedures before opening a wallet.


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