Aside from artificial intelligence, few innovations have dominated the financial services discussion in recent years as much as stablecoins.
The benefits of these digital assets are no longer speculative; they have been demonstrated across a wide range of use cases in a thriving global market. This promise has made stablecoins highly attractive to financial institutions, yet many are still uncertain about the best way to integrate them into their existing offerings.
One of the key challenges is complexity. For most organizations, building stablecoin infrastructure from scratch is a nonstarter. While there are a wide range of partners ready to support institutions, many banks and credit unions still struggle to differentiate which solutions are the right fit.
To guide these organizations, Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research, developed the Stablecoin Partner Guide for FIs: A How-To and What to Askreport. The goal is to establish criteria banks can use to select appropriate partners and to outline tactical strategies for adding stablecoin settlement services, ultimately modernizing infrastructure for the digital, payments-driven future.
The Five Criteria for Stablecoin Partners
While the crypto space may still feel nascent to some, it has matured rapidly over the past 17 years. The industry received long-awaited regulatory clarity—at least with respect to stablecoins—with the passage of the GENIUS Act. For many, the landmark bill signaled that digital assets are poised to play a larger role in the financial system.
As the industry has matured, many digital asset firms have developed deep financial expertise, though the ecosystem remains somewhat fragmented. To clarify the roles of key participants, Javelin delineated five core categories of stablecoin partners: issuance, custody, infrastructure, compliance, and system integrators.
Issuance partners operate the frameworks that mint, burn, and manage stablecoins. Tether, issuer of USDT, has a commanding lead in the market due to its global scale and extensive ecosystem. However, Circle has gained significant traction with FIs, as its USDC stablecoin was designed with compliance and regulatory alignment in mind.
Custody partners hold the treasury reserves that back stablecoins. Coinbase is the largest and most widely recognized institutional-grade custodian, alongside firms like BitGo and Fidelity Digital Assets.
Infrastructure providers—such as Fireblocks and Bridge—offer tools including APIs and wallet management systems. These firms help standardize institutional rails across multiple jurisdictions, enabling stablecoin transfers at scale.
Compliance-focused partners manage Know Your Customer (KYC), Anti-Money Laundering (AML), and sanctions screening. Firms like Chainalysis and TRM Labs support customer vetting, transaction monitoring, and on-chain forensic analysis.
Finally, system integrators connect blockchain-based stablecoin rails to traditional banking system. While digital-asset-native firms such as Stablecore and BVNK play in the space, the “Big Four” firms—Deloitte, KPMG, EY, and PwC—are also active players.
Understanding each of these five categories, and the companies within them, is key for financial institutions looking to move forward with stablecoin adoption.
“I guess you could say this report was meant to spark internal brainstorming and discussions,” Hugentobler said. “It’s not: step one, do this; step two, do this. It’s a practical framework to finding the right partner.”
Developing a Flexible Stablecoin Strategy
Amid these criteria and partner options, many institutions may seek a one-size-fits-all solution they can implement and “set and forget.” Unfortunately, the complexity of digital assets makes this unrealistic today.
“That’s the tricky thing, maybe aside from some of the system integrators who are very code heavy, there’s not a lot that provide an all-encompassing solution for every aspect,” Hugentober said. “That can get complex when you’re integrating all these third parties into a system. They might not all be required, depending on the use case or the type of FI.”
Instead, institutions should begin by targeting areas of high cost or operational friction, with the understanding that stablecoins are not a universal solution for every payment challenge.
That said, 24/7 real-time settlement—with full transparency and lower fees—can be transformative in areas like treasury management and cross-border payments, both of which have long been persistent pain points.
For example, many cross-border payments are delayed as they pass through multiple correspondent banks, each operating with different business hours and regulatory frameworks.
While shifting to 24/7 stablecoin settlement can help eliminate many of these frictions, it may also require banks to adapt their operational models. Even so, this modernization is becoming imperative for all institutions as the move to real-time payments accelerates across all payment types.
“FIs need to focus on flexibility from day one,” Hugentobler said. “If an FI partners with a vendor or integrator and they lock that deal in for 10 years and six months goes by and they’re doing a lot of things they don’t like or that doesn’t fit with their strategy, they need to be able to pivot and find another vendor that better fits them.”
“There’s a lot of moving parts with this technology, so FIs need to align with third parties that can pivot and can be flexible,” he said.
A World of Digital Assets
U.S. dollar-backed stablecoins have garnered the limelight because they dominate the market, but they represent only one segment of a rapidly expanding digital asset ecosystem. This includes cryptocurrencies like bitcoin and Ethereum, central bank digital currencies, infrastructure components such as blockchain and wallets, and even stablecoins backed by other fiat currencies or assets like gold.
All of these innovations hold significant potential for financial institutions, but perhaps none more so than tokenized deposits, which can deliver the same benefits of instant settlement and low fees within a fully regulated banking environment.
The good news for financial institutions is that building the infrastructure to support stablecoins may also prepare them to support tokenized deposits and other digital assets in the future. This optionality makes it even more important to select the right partners today.
“At the end of the day, banks have to remember that they don’t have to do this by themselves, they don’t have to build it from ground zero,” Hugentobler said. “There are a lot of super solid companies with a ton of experience out there to help them get from A to B to C.”
