Bank stablecoins moved from pilot slides to real products in 2026. In Hong Kong, HSBC is preparing to issue a regulated Hong Kong dollar coin to millions of retail users. In the United States, JPMorgan has taken its dollar deposit token onto Ethereum, the chain where most tokenized funds already live. Both arrive as the US finalizes its own GENIUS Act rules for payment stablecoins, which take effect on 18 January 2027.

For crypto-native issuers and the apps that distribute their coins, this is a new kind of competitor. At AnkhLabs we don't expect banks to take market share overnight. The bigger question is how their arrival changes what users expect a stablecoin to promise and prove.

What are bank stablecoins?

"Bank stablecoin" is used loosely for two different things, and the difference matters.

The first is a bank-issued stablecoin: a token that a bank or its subsidiary issues under a stablecoin licence. It is backed by a reserve of cash and short-term government debt and redeemable at par (one token for one unit of currency). HSBC's RedCoin falls in this group. It works like USDC, only with a bank behind it.

The second is a deposit token: a token that represents money a client already holds at the bank. It is a claim on the bank itself, not on a separate pool of reserves. JPM Coin is a deposit token. In the US this distinction is written into law. The GENIUS Act's definition of a payment stablecoin excludes "a deposit (as defined in 12 U.S.C. 1813), including a deposit recorded using distributed ledger technology", as the final rule from the Office of the Comptroller of the Currency (OCC) restates. Deposit tokens therefore stay under banking rules rather than the new stablecoin regime.

For marketers, the short version is this. A bank-issued stablecoin competes directly with USDT and USDC. A deposit token competes with wire transfers and with crypto firms selling settlement to institutions.

Why are banks issuing stablecoins now?

Three things changed at once. The rules arrived, with Hong Kong licensing issuers from August 2025 and the US setting a federal framework that starts in January 2027. The use case matured, as tokenized funds and securities created real demand for a cash token on the same chain. And banks saw a threat to their deposits. When bank groups warn that trillions in deposits could move to stablecoins that pay rewards, launching their own token becomes a defensive move as much as an innovative one.

Each bank chose the format that fits its customers. HSBC, with a large retail base in Hong Kong, chose a licensed stablecoin for payments. JPMorgan, serving institutions, chose a deposit token that keeps clients' money on its own balance sheet.

What is HSBC's Hong Kong dollar stablecoin?

Hong Kong's Stablecoins Ordinance took effect on 1 August 2025 and made issuing fiat-referenced stablecoins a licensed activity. The Hong Kong Monetary Authority (HKMA) received 36 applications and on 10 April 2026 granted the first two licences, The Block reported. One went to HSBC and the other to Anchorpoint Financial, a joint venture of Standard Chartered, Animoca Brands and HKT. "The granting of stablecoin issuer licences is an important milestone for the development of digital assets in Hong Kong," HKMA chief executive Eddie Yue said.

The regulator had said it would prioritise note-issuing banks, and both HSBC and Standard Chartered issue Hong Kong banknotes. Anchorpoint plans its own Hong Kong dollar coin called HKDAP, which Standard Chartered chief executive Bill Winters described as a regulated medium of exchange.

On 30 September 2026 HSBC named its coin RedCoin, as Ledger Insights reported. At launch it will be available through PayMe, HSBC's payments app with 3.3 million retail users. The first uses are person-to-person and merchant payments. A plan to use the coin for buying tokenized investments appears to have been dropped, possibly because it would need separate securities approval. HSBC now also plans wholesale and corporate uses. The coin had not been issued when it was named, and Ledger Insights suggested launch could wait for Hong Kong Fintech Week in November.

HSBC's own research, also reported by Ledger Insights, shows why the marketing will be delicate. In a June survey, 60% of respondents understood that stablecoins are backed by fiat money, but just over a quarter thought stablecoins are issued by the government. When the issuer is also one of the city's banknote issuers, that confusion is easy to understand and hard to undo.

What is JPM Coin, and why did it move to Ethereum?

JPM Coin (JPMD) is a dollar deposit token issued by Kinexys, JPMorgan's blockchain unit. Each token represents a US dollar a client holds at the bank. It launched in November 2025 on Base, Coinbase's layer 2 network that runs on top of Ethereum. On 19 October 2026 it went live on the Ethereum mainnet itself, according to Ledger Insights. Approved institutional clients can now move tokenized JPMorgan deposits across Base and Ethereum at any hour, with the Canton Network planned next.

The reason for Ethereum is where the assets are. Ethereum hosts large tokenized funds, including BlackRock's BUIDL and JPMorgan Asset Management's own tokenized money market funds. A deposit token used as the cash side of a trade has to sit on the same chain as the asset it pays for. DailyCoin notes that JPMorgan launched its first tokenized money market fund on Ethereum in December 2025 and a second in May 2026.

The headline numbers need care. Kinexys says it has processed more than $4 trillion in total and about $7 billion a day, but Ledger Insights points out that these cover all Kinexys services, not JPM Coin on public chains. JPMorgan has not said how much JPMD is in circulation on Ethereum.

Bank stablecoins and crypto-native stablecoins, side by side

Sources: The Block, Ledger Insights, DailyCoin, CoinGecko.

What do bank stablecoins mean for crypto-native stablecoins?

In the short term, not much in market share. Stablecoins were worth about $297 billion as of 26 October 2026, according to CoinGecko, and USDT and USDC made up about $254 billion of that. Neither RedCoin nor JPMD is designed to compete for that liquidity. One is a local retail payments coin and the other a closed institutional tool. Our article on why Tether dominates stablecoins explains why network effects in trading and cross-border use are hard to dislodge.

The longer-term pressure comes from three directions.

• Distribution. HSBC can switch a stablecoin on for millions of existing customers who never have to install a wallet. Crypto-native issuers buy distribution through exchanges, wallets and fintech partners. We covered how that works in our piece on stablecoin distribution.

• Institutional settlement. If JPMorgan's clients can settle tokenized fund trades in JPMD on Ethereum, they have less reason to hold a third-party stablecoin for that leg. This is the segment crypto-native issuers have been pitching hardest, as our article on institutional crypto adoption describes.

• Policy. Banks are lobbying against stablecoin rewards. American Banker reports that bank groups cite a Treasury advisory committee estimate that $6.6 trillion in deposits could move if reward workarounds are allowed. Deposit tokens are legally deposits, so they sit outside that fight.

How should crypto-native stablecoin teams market against banks?

Banks start with trust that crypto firms have to earn. The temptation is to copy their tone. A better approach is to compete where banks are slow.

First, sell openness. USDT and USDC work on many chains, in any wallet and across borders. RedCoin will start inside HSBC's own apps and JPMD inside JPMorgan's client base. For developers, DeFi (decentralised finance) protocols and global users, that difference is the product. Say it plainly and show it with integrations, not adjectives.

Second, prove reserves in public. A bank's brand does a lot of the reassuring for it. A crypto-native issuer has to do it with data: regular reserve reports, named custodians and easy redemption. Under the US rules every permitted issuer will have to publish monthly reserve reports anyway, so make yours the easiest to read.

Third, never borrow the government's credibility. HSBC's survey shows how readily users assume stablecoins are state-issued. US rules already bar issuers from marketing a coin in a way a reasonable person would read as government-backed. Clear copy on what a stablecoin is and is not protects users and the brand.

What we'd tell a founder

If you run a wallet, exchange or payments app, plan to support bank stablecoins rather than fight them. Users will eventually hold several kinds of digital dollar and Hong Kong dollar, and the app that explains the differences clearly will keep them. Our piece on stablecoin adoption covers where real usage is growing.

If you are building infrastructure that banks might use, your audience is now compliance teams and treasury desks as well as developers. That calls for a different voice and different proof points. For Rayls, a blockchain infrastructure project, we ran a programme that acquired 20K+ followers and reached 500K+ people. More examples are in our case studies, and our product marketing work starts with exactly this kind of positioning.

If you issue a crypto-native stablecoin, write down the three things you can say that a bank cannot, and make sure your site, docs and partner materials say them consistently.

If you are positioning a stablecoin or payments product against the banks and want a second opinion, talk to AnkhLabs.

The bottom line

Bank stablecoins are no longer a theory. HSBC has a licence, a name and 3.3 million potential users in PayMe. JPMorgan has a deposit token on the same chain as the tokenized funds its clients buy. Neither threatens USDT or USDC this year. What they do is raise the bar for every stablecoin's story, because users will now compare a crypto issuer's promises with those of a global bank.

This article is for information only and is not investment or legal advice. Figures are as of 26 October 2026.