JPMorgan Explores Public Stablecoin in Challenge to Tether's $187B USDT

JPMorgan Weighs Public Stablecoin Entry

JPMorgan Chase is evaluating whether to issue a public stablecoin, a product that would sit apart from the bank's existing JPM Coin deposit token and put the largest U.S. bank in direct competition with PayPal's PYUSD stablecoin, Tether and Circle in the digital dollar market. A Wall Street Journal report published on Aug. 26, 2026 mapped the shift: a bank spokesperson confirmed the firm has no current plan to launch a stablecoin but would consider its options as customer demand and the regulatory environment evolve. The distinction is structural rather than cosmetic. JPM Coin — which trades as JPMD on Coinbase's Base network — is a tokenized deposit that stays on the bank's balance sheet, while a public stablecoin would function as a bearer token anyone can hold without a JPMorgan account. The bank's Kinexys platform, formerly Onyx, has processed more than $4 trillion in cumulative transactions, with daily volume averaging above $7 billion as of June 2026, up from $5 billion earlier in the year.

Chris Dixon on stablecoins rivaling major payment networks at $300 billion issued

The legal opening came from the GENIUS Act, signed by President Donald Trump on July 18, 2025, which created the first federal framework for payment stablecoins and gave banks a clear license path. The market it regulates now stands at roughly $316 billion in total supply, with Tether's USDT holding about $187 billion — 59 percent — and Circle's USDC near $75 billion, though USDC carries roughly 70 percent of adjusted transaction volume. The legislation prohibits issuers from paying returns to holders, closing off the yield-bearing stablecoin model that some crypto-native issuers have pursued. Regulators missed the statute's one-year implementation deadline on July 18, 2026; the OCC now targets November 2026 for final rules, with enforcement generally beginning January 18, 2027. Meanwhile, 39 state banking associations have formed the BankChain Alliance — 3,283 banks holding $21.8 trillion in combined assets — to build shared permissioned blockchain infrastructure targeting a 2027 launch, and Early Warning Services, the Zelle operator owned by seven major banks, launched its ZLUSD stablecoin in June 2026.

Kraken Wallet's Co-Signing Multisig

While banks build regulated digital dollar rails, Kraken is pushing in the opposite direction: better tooling for users who hold their own keys. The exchange announced plans to add co-signing multisig functionality to Kraken Wallet, its self-custody wallet. Under the design, a user's private key is split into several shards, with one shard retained by Kraken; the exchange then participates in signing transactions only after passing account two-factor authentication. The plan was laid out in the Kraken Wallet Manifesto by the exchange's on-chain product lead. An iOS version of the wallet is available now, an Android release is slated for next week, and the stated fee is 0.1%. Unlike a custodial arrangement where the exchange holds every key, Kraken holds only a partial signing piece, reducing the single point of failure that ordinary single-key wallets carry. The wallet supports externally owned accounts, EIP-7702 smart accounts and embedded wallets, and users can attach existing hardware wallets such as the Tangem wallet or established multisig setups, dividing wallets by risk level. A published roadmap adds xStocks trading, stablecoin and fiat conversion, a non-custodial debit card, on-chain K-Assets under qualified custody, and Ink ecosystem integration. No launch date, supported networks or regions for the co-signing feature have been disclosed. Readers tracking the market in real time can follow live spot and futures prices on MEXC.

2027 Enforcement Deadline Looms

The two stories frame one shift from opposite ends. COINOTAG's reading: the GENIUS Act itself — the primary document anchoring this cycle — requires dollar-for-dollar reserves in Treasury bills, insured deposits or repurchase agreements, monthly attested reserve disclosure with executive certification, and a ban on interest payments, while restricting unlicensed U.S. issuance from January 18, 2027. That framework is pulling the largest banks into issuance, and Tether's unresolved Treasury reciprocity determination leaves its $187 billion token exposed, while exchanges counter by making self-custody operationally safer.