U.S. Bank Tests USBDC Stablecoin on Stellar

U.S. Bank has completed its first live pilot of the USBDC stablecoin, transferring real funds between its U.S. and European operations using the public Stellar (XLM) blockchain. The test marks a significant step toward institutional adoption of blockchain-based cross-border payments.

Rather than building a private blockchain, U.S. Bank opted to use Stellar’s open network. The approach demonstrates how regulated financial institutions could move capital over public blockchain infrastructure while maintaining compliance and risk controls.

Jamie Walker, U.S. Bank’s head of digital assets, said the platform is integrated with the bank’s internal risk management systems. USBDC also includes freezing and clawback capabilities, allowing the bank to stop or reverse transactions when funds are sent incorrectly or when compliance concerns emerge.

Stellar Development Foundation CEO Denelle Dixon described the pilot as an important example of institutional blockchain adoption. The project demonstrates how regulated banks can potentially use Stellar’s speed and open infrastructure for compliant cross-border settlement.

U.S. Bank CEO Gunjan Kedia confirmed the pilot was successful, saying the technology could eventually enable the bank to transfer capital between continents around the clock at minimal cost. Blockchain settlement could also reduce dependence on traditional intermediaries and lengthy interbank reconciliation processes.

For now, USBDC will remain an internal instrument designed for treasury operations and settlements rather than public use.

Stellar was selected partly because of its established infrastructure for stablecoins and tokenized real-world assets. According to RWA.xyz data cited in the original report, Stellar currently hosts approximately $3.32 billion in real-world assets, while USDC on the network has around 685,000 holders.

U.S. Bank’s model is expected to involve only a limited number of wallets controlled by its divisions, potentially processing substantial transaction volumes between them.

The successful USBDC stablecoin pilot could give U.S. Bank an early advantage as major financial institutions explore tokenized settlement systems. While other banking groups are working toward shared interbank tokens, U.S. Bank has already demonstrated a functioning stablecoin settlement model on a public blockchain.