Citi and Coinbase expand stablecoin payments

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Citi adds Coinbase

Highlights

Citi is adding Coinbase rails for stablecoin payments.
Corporate clients can accept stablecoins at checkout.
Citi Token Services is expanding to new markets.

Institutional clients will be able to receive stablecoins at checkout, with Coinbase providing the payment rails and technology needed to convert the tokens into government-issued currency before Citi settles the funds as bank of record. The partnership marks another step in the convergence of conventional banking and blockchain-based payments, according to the WSJ.

Stablecoins move into corporate payments

The service targets multinational companies already using Citi for payment processing. While cryptocurrencies such as Bitcoin have made limited progress as everyday payment methods, dollar-linked stablecoins are increasingly being tested for commercial transactions and cross-border transfers.

Coinbase customers will also gain access to Citi banking capabilities that allow incoming cash to be converted automatically into stablecoins. Those tokens can remain with Coinbase and currently carry an annual reward rate of 3.75%.

The division of responsibilities keeps conventional settlement within the banking system. Coinbase supplies the blockchain infrastructure and handles the digital-asset side of the transaction, while Citi manages the corresponding traditional-currency settlement.

Citi broadens its blockchain network

The Coinbase partnership is part of a wider digital-payments expansion at Citi. The bank is extending Citi Token Services to Japan and the United Arab Emirates, bringing the blockchain-based service to seven jurisdictions, including the U.S.

Citi Token Services allows multinational companies to transfer their own funds across the bank's network around the clock. The bank has been developing the platform alongside other initiatives designed to bring tokenized money into existing financial infrastructure.

Citi is also participating in plans for a tokenized deposit system expected to launch next year and is among nearly two dozen companies working on a stablecoin project. Separately, it has established a blockchain-based venture for wealthy and institutional clients trading shares in private companies.

Banks keep building digital payment rails

The expansion comes as U.S. lawmakers continue debating the regulatory framework for digital assets. The CLARITY Act recently failed to advance in the Senate amid disagreements that included whether crypto platforms should be permitted to offer rewards on stablecoin holdings.

Citi, however, is proceeding with products that can operate under its existing banking licenses and regulatory framework. The Coinbase arrangement reflects that approach: stablecoins provide the digital payment layer, while the bank retains responsibility for regulated fiat settlement.

For corporate customers, the practical change is straightforward. A business can receive a blockchain-based dollar payment while continuing to use Citi for its conventional banking relationship, reducing the separation between stablecoin transactions and established payment infrastructure.

Earlier, we reported that Citi seeks China brokerage license to accelerate expansion.

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