Citi Backs Stablecoin Infrastructure Firm BVNK Amid Growing Crypto Adoption
Citi Ventures, the venture capital arm of Citigroup, has invested in BVNK, a San Francisco-based startup specializing in stablecoin infrastructure. This move underscores the increasing involvement of major U.S. banks in the cryptocurrency and digital asset sectors. Stablecoins, digital assets pegged to fiat currencies and backed by real-world assets such as bonds, have gained prominence for their potential to streamline cross-border payments. BVNK’s core technology acts as a payments rail, enabling seamless conversion and transfer between fiat currencies and stablecoins globally. While the financial details of Citi’s investment and BVNK’s current valuation remain undisclosed, co-founder Chris Harmse confirmed to CNBC that the company’s valuation has surpassed the $750 million mark established during its previous funding round.
Stablecoins: A Growing Force in Digital Payments
Once primarily a vehicle for rapid cryptocurrency trading, stablecoins are now recognized as key instruments for international transactions. Their advantages include faster settlement times, lower transaction costs, and continuous 24/7 operation. According to Visa, stablecoin transactions amounted to nearly $9 trillion over the past year. CoinMarketCap data indicates the total market capitalization of stablecoins exceeds $300 billion.
U.S. Market Momentum and Regulatory Clarity
BVNK has experienced its fastest growth in the United States over the last 12 to 18 months, driven by a regulatory environment viewed as more favorable by the crypto industry. The passage of the GENIUS Act earlier this year has provided clearer rules to regulate the stablecoin sector.
“With the GENIUS Act and regulatory clarity, there is an explosion of demand for building on top of stablecoin infrastructure,” said Chris Harmse, co-founder of BVNK.
BVNK’s platform enables clients to pay suppliers, contractors, and merchants across borders. The startup is actively seeking to expand its customer base, including targeting digital-only banks and neobanks that may utilize stablecoins as part of their core checking accounts.
Partnerships and Industry Trends
Although BVNK declined to share details of its collaboration with Citi, Harmse noted that the bank is strengthening its cross-border payment capabilities. He emphasized that major U.S. banks like Citi are strategically investing in leading crypto businesses to stay at the forefront of payment technology innovation. Citi has signaled broader ambitions in crypto this year. CEO Jane Fraser revealed in June that the bank is exploring the issuance of its own stablecoin and considering crypto asset custody services. BVNK has experienced fluctuating profitability as it invests heavily in growth but is on track to achieve profitability next year. The company counts Coinbase and Tiger Global among its investors and competes in a crowded field alongside firms like Alchemy Pay, TripleA, and Ripple.
Wall Street’s Expanding Embrace of Digital Assets
Citi’s move is part of a broader trend among major U.S. financial institutions integrating digital assets into their operations. JPMorgan Chase, for example, launched its own stablecoin-like token, JPMD, earlier this year and began allowing clients to purchase bitcoin. Banks are increasingly exploring blockchain technology, initially developed for bitcoin, to enhance transaction efficiency and reduce costs. This includes initiatives around tokenization — issuing digital tokens representing traditional financial instruments such as deposits. Notably, Bank of New York Mellon is investigating tokenized deposits, and HSBC has already launched a tokenized deposit service.
FinOracleAI — Market View
Citi’s investment in BVNK highlights the accelerating convergence between traditional finance and digital asset infrastructure. Stablecoins are transitioning from niche crypto tools to foundational elements of the global payments ecosystem, especially for cross-border transactions.
- Opportunities: Enhanced payment speed and cost efficiency, regulatory clarity via the GENIUS Act, expanding use cases for stablecoins in banking and commerce, and increased institutional adoption.
- Risks: Regulatory uncertainty remains outside the U.S., competitive pressure from established and emerging players, and potential volatility in stablecoin backing assets.
Impact: Citi’s strategic backing of BVNK signals growing Wall Street confidence in stablecoin technology as a critical component of next-generation payment systems, potentially accelerating mainstream adoption of digital assets.
