More traditional institutions are entering the virtual currency industry. Banco Bilbao Vizcaya Argentaria (BBVA), a Spain-based bank with over $800 billion in assets that serves more than 89 million customers, will enter the stablecoin market.

BBVA head of digital assets and blockchain Francisco Maroto stated that the company was currently in the project’s sandbox stages, which would leverage a Visa program allowing other financial companies to launch their stablecoins. BBVA’s goal is to reach the launch phase next year.

While the bank has not yet chosen the fiat currency that will be linked to this upcoming stablecoin, Maroto pointed out that it is likely to be the Euro due to the organization’s foothold in Europe. Furthermore, Maroto stressed that the organization is not focused on the U.S. with this launch, at least not in the short term.

BBVA disclosed that it decided to work with Visa due to its regulatory compliance, which would simplify the bank’s procedures compared to adopting other stablecoin options

While the product will likely only be allowed within the bank’s ecosystem at first, the idea is to allow for the interoperability of these assets between different institutions, mimicking the properties of stablecoins like USDT and USDC, present in several blockchains.

While stablecoins are now a crowded market, with incumbents already commanding billions in market capitalization, alternatives backed by traditional financial institutions are still almost non-existent. Paypal, the giant payments processor, launched its PYUSD stablecoin in August 2023, and while it has faced scrutiny from U.S. regulators, it reached a market capitalization of close to $700 million.

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