A consortium of 21 financial institutions has committed about $270 million in funding to a stablecoin initiative known as Project Faro. The project, backed by big banks, aims to act as a stablecoin issuer and launch a US dollar stablecoin in the first half of 2027.
According to Bloomberg, the funding is intended to cover five years of operations for the new company, which plans to issue stablecoins pegged to the currencies of all G7 countries, with a euro-backed coin expected to follow the dollar launch.
The group first announced the initiative in September. While confirmed details are thin, people familiar with the matter said the company is expected to be incorporated in the US, Bloomberg reported.
The group includes banks such as Citigroup, Goldman Sachs, Banco Santander, Deutsche Bank and BBVA. Similar initiatives are also underway, including Stripe-led Open USD, which counts Visa among its founding partners, and Qivalis, a European banking consortium seeking to challenge the dominance of US dollar-pegged stablecoins.
Overlap with rival consortiums
BBVA is one of 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 to reach 37 members. BNP Paribas was among the 10 banks that first explored what became Faro in October 2025 and later joined Qivalis.
Qivalis has since made progress on the regulatory front, receiving authorization from the Dutch central bank as an electronic money institution in October 2026. The consortium is preparing to launch a fully regulated, euro-denominated stablecoin, with plans to make it available for payments, cross-border settlements and tokenized asset transactions.
The overlap highlights how traditional financial institutions are positioning themselves across multiple initiatives rather than committing exclusively to a single stablecoin issuance project.
By participating in competing projects, banks can explore different approaches to issuing and distributing digital currencies while retaining a stake in the infrastructure that could underpin future payment and settlement systems.
Related: BofA, Citi, Goldman Sachs among 21 institutions planning stablecoin launch
A crowded room
Despite the growing institutional interest, Faro is entering a market dominated by two crypto-native issuers.
Tether‘s USDT and Circle’s USDC account for 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, while USDC accounted for around $70.4 billion.
Distribution could, however, offer the bank-backed venture a competitive advantage. Faros participating institutions already have established banking customers, payment networks and relationships with businesses and financial institutions that could help distribute a new stablecoin.
Rather than building an entirely new customer base, the consortium could leverage those existing relationships to introduce its stablecoin to new audiences, including retail users. Open USD, developed by the Open Standard consortium, is pursuing a similar approach by bringing together payment providers, banks, financial technology companies and merchants around a shared stablecoin infrastructure.
The challenge for both will be translating their existing financial infrastructure and customer relationships into a competitive onchain payment network.