A consortium of 21 financial institutions has pledged about $270 million to fund Project Faro, a stablecoin initiative backed by major banks. The project aims to become a stablecoin issuer and launch a US dollar stablecoin in the first half of 2027.
Bloomberg reports that the funding is intended to cover five years of the new company’s operations. The company plans to issue stablecoins pegged to the currencies of all G7 countries, with a euro-backed coin expected after the dollar launch.
The group announced the initiative in September. Details remain limited, but people familiar with the matter told Bloomberg that the company is expected to be incorporated in the US.
The group includes Citigroup, Goldman Sachs, Banco Santander, Deutsche Bank and BBVA. Other similar efforts are also in development. These include Stripe-led Open USD, whose founding partners include Visa, and Qivalis, a European banking consortium seeking to challenge the dominance of US dollar-pegged stablecoins.
Overlap with rival consortiums
BBVA is among several Faro members also involved in competing stablecoin initiatives, including Open USD and Qivalis. Dutch lender Rabobank is also a Faro member and joined Qivalis in May, when the euro consortium added 25 banks, bringing its membership to 37. BNP Paribas was one of the 10 banks that initially explored what became Faro in October 2025 and later joined Qivalis.
Qivalis has since advanced on the regulatory front, receiving authorization from the Dutch central bank to operate as an electronic money institution in October 2026. The consortium is preparing to launch a fully regulated euro-denominated stablecoin, intended for payments, cross-border settlements and tokenized asset transactions.
The overlap shows how traditional financial institutions are positioning themselves in multiple initiatives instead of committing exclusively to one stablecoin issuance project.
By taking part in competing projects, banks can explore different ways to issue and distribute digital currencies while retaining a stake in infrastructure that could support future payment and settlement systems.
A crowded room
Despite growing interest from institutions, Faro is entering a market dominated by two crypto-native issuers.
Tether’s $USDT and Circle’s $USDC make up approximately 85% of the roughly $290 billion stablecoin market as of Nov. 10, according to DefiLlama. $USDT had a market capitalization of approximately $176.3 billion, compared with around $70.4 billion for $USDC.
Distribution could, however, give the bank-backed venture a competitive edge. Faro’s participating institutions already have established banking customers, payment networks and ties to businesses and financial institutions that could help distribute a new stablecoin.
Instead of building a customer base from scratch, the consortium could use those existing relationships to introduce its stablecoin to new audiences, including retail users. Open USD, developed by the Open Standard consortium, is taking a similar approach, bringing payment providers, banks, financial technology companies and merchants together around shared stablecoin infrastructure.
Both projects will face the challenge of turning their existing financial infrastructure and customer relationships into a competitive onchain payment network.
Source: cointelegraph.com. Adapted by NBTC.
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