SoFI bank has announced the launch of SoFiUSD, its native 1:1 cash-backed fully reserved US dollar stablecoin, as it seeks to bridge regulated banking with on-chain finance.
The move makes SoFi the first US national bank to release a stablecoin on a public, permissionless blockchain.
Its launch will enable SoFi to serve as a stablecoin infrastructure provider for credit institutions, FinTech and corporate platforms. These entities will be able to leverage the platform to streamline their operations with faster and more efficient money movements, the bank said.
By using SoFiUSD on a public blockchain, partners will be able to transfer funds 24 hours a day with near-instant settlement at fractional pricing, with the system enabling them to manage liquidity more securely and provide faster services to their customers, the bank added.
As a nationally authorised and insured depository bank, SoFi has stated that it can hold cash reserves in its federal bank account without any liquidity or credit risk, with the infrastructure enabling FinTech and corporate partners to leverage SoFi’s regulatory, operational and reserve framework to issue white label stablecoins or integrate SoFiUSD into their settlement flows.
The move comes after SoFi became the first US bank to offer consumers cryptocurrency trading last month, enabling SoFi members to buy, sell and hold nearly 30 coins.
Anthony Noto, chief executive of SoFi, said that blockchain is a “technological super cycle” that will radically change finance in every monetary sector.
He added that at a time when businesses face challenges related to slow payments, fragmented suppliers, and unverified reserve models, SoFi can provide fully confidential on-chain technology to promote a more efficient way to transfer funds.
“With SoFiUSD, we’re using the infrastructure we’ve built over the last decade and applying it to real-world challenges in financial services,” he added.
SoFi currently counts over 12.6 million members who use the banking platform to borrow, save, spend, invest money, and get access.
The bank’s app also offers financial planners and exclusive experiences.
