By Cooper Thompson
A seismic shift is underway in the U.S. finance ecosystem. Stablecoins, which are digital dollars backed by fiat currency on a 1:1 basis, are moving beyond their reputation as crypto experiments, thanks to clear new legislation and technological integrations by key service providers.
The GENIUS Act provides a comprehensive regulatory framework for stablecoin issuers, introducing crucial guardrails and a path for compliant participation. This landmark legislation creates opportunities for credit unions to offer real-time, programmable payments and other digital asset services.
By providing a clear and regulated framework, the GENIUS Act is encouraging local credit unions to develop new, unique services for their expanding customer groups. Credit unions can now confidently explore offering instant, low-cost domestic and international payments, which can help them attract and retain younger members who are interested in digital assets.
For many credit unions, however, the rise of digital assets still raises concerns. Some executives fear deposit leakage if members move funds to external platforms, particularly those run by big tech companies. However, this competitive pressure is also the call to action for credit unions to get involved early. Their members would benefit, too.
The Benefits Of Stablecoins
Institutions that wait may find that the new financial rails are formed elsewhere. Credit unions have distinct advantages, from their inherent member trust to their existing digital environments. When stablecoins are offered through a credit union’s trusted digital platform, members can access modern financial tools without switching apps or enrolling in another service, and credit unions can strengthen their relationships with members.
This approach directly addresses the challenge of balance sheet leakage, which occurs when members move funds externally to diversify their assets. By offering trusted, institution-friendly stablecoins, credit unions can meet this demand while retaining deposits. They can even unlock new revenue streams by earning net interest income from these digital assets.
Unlocking New Member Value: Stablecoins give credit unions a practical way to offer faster, more efficient payments, improve services for business members, and meet the rising expectations of a digital-first generation. As trusted financial partners for their customer portfolio, credit unions have the opportunity to serve as a starting point for members looking to enter the digital transaction space.
More efficient, real-time payments: Stablecoins equip credit unions with a more efficient, real-time global money movement service to better support both retail and commercial members. This offers a stable digital alternative that is especially impactful for cross-border payments and remittances, which can be expensive and slow on traditional rails. Stablecoins also equip credit unions with significantly faster payment settlement options. Stablecoin transactions are finalized much faster than traditional wire transfers, enabling credit unions to offer an instant money movement experience for their customers.
Programmable payments: The programmability of blockchain payments allows credit unions to add data payload, provide unique settlement features, and enable greater transparency across all payments. These capabilities give credit unions a way to offer fast, flexible experiences that feel modern and personalized, paving the way for a more digital-based economy. Blockchain payments have also become a driving force for personalized reward programs for credit union members, with primary examples including real-time cash back or discounts that can be established instantly following a purchase.
Gateway to new financial experiences: Stablecoins provide a strategic entry point to the broader digital asset ecosystem. They can serve as a foundation for credit unions to eventually explore additional areas such as tokenized deposits and other on-chain financial products. For members curious about crypto, the ability to engage with digital assets through a trusted credit union could be the deciding factor in their willingness to participate.
Digital Dollars, Community Roots
Stablecoins are not a cure all, and on their own, they are not a threat. They are a faster rail for dollars and provide the opportunity to inject logic and data into a transaction. For credit unions, the real question is who owns the everyday experience for moving those dollars. If that experience lives inside local institutions, Main Street stands to benefit from speed and clarity without losing trusted relationships built up over many years. Conversely, if the experience migrates to nonbank platforms, the economics and connection to local members could migrate with it.
This is the competitive stake of digital dollars today. It’s less a debate about crypto itself and more about positioning credit unions to lead in a financial landscape where offering alternative payment options is key to attracting and retaining younger members who show growing interest in digital assets. The strategic responses displayed by credit unions following stablecoins’ introduction into financial services is all about leveraging trust and relationships with customers. Local credit unions typically don’t have the infrastructure to ignore these innovations when competing with larger financial institutions, but they can always lean into their greatest strengths: a member-centric model, trust, and most importantly, community bonds.
Cooper Thompson is VP, Innovation, at Fiserv.