U.S. Bancorp’s entry into the stablecoin arena has injected fresh excitement into the Stellar ecosystem, marking a significant shift as major financial institutions begin leveraging public blockchains for real-world money movement.
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The fifth-largest U.S. bank is piloting a dollar-backed stablecoin on Stellar, an initiative that could accelerate institutional adoption and strengthen market confidence in XLM heading into year-end.
XLM's price trends to the downside on the daily chart. Source: XLMUSD on Tradingview
U.S. Bancorp Selects Stellar for Bank-Grade Stablecoin Infrastructure
The Minneapolis-based banking giant has partnered with PwC and the Stellar Development Foundation (SDF) to test programmable deposits and stablecoin payments on Stellar’s public blockchain.
What sets Stellar apart, according to U.S. Bank’s digital assets head Mike Villano, is its built-in ability to freeze assets, unwind transactions, and enforce compliance at the protocol level.
These capabilities are essential for regulated banks that must adhere to KYC, AML, and consumer protection standards. Unlike traditional “business logic” solutions, Stellar offers these controls directly at the blockchain layer, giving banks the confidence needed to explore tokenized finance.
The pilot arrives amid a resurgence of institutional interest. Banks, including Citi, Goldman Sachs, and Bank of America, have begun designing stablecoin frameworks. U.S. Bank recently relaunched its digital assets division to tap into opportunities in custody, tokenisation, and blockchain-based payments.
Institutional Momentum Could Drive Mainstream Stablecoin Adoption
If successful, U.S. Bancorp’s trial could pave the way for fully regulated, deposit-backed stablecoins issued directly by banks, unlocking new efficiencies for cross-border transfers, treasury operations, and global settlements.
With projections suggesting that stablecoin payments could reach $1 trillion annually by 2030, banks are racing to claim their share of the digital payments market.
Stellar’s high uptime, low-cost settlement, and remittance-focused architecture make it an appealing choice for real-world financial applications. As institutions embrace public blockchains, Stellar stands positioned as one of the few networks offering both decentralization and the regulatory controls banks require.
XLM Price Outlook: Analyst Targets Signal 24–36% Upside
The U.S. Bancorp announcement has arrived at a pivotal time for Stellar’s native token, XLM. Trading near $0.25, the asset is showing early signs of bullish momentum, supported by:
- MACD bullish divergence
- Neutral RSI at 42, offering room to climb
- Price sitting on 20-EMA support
- Breakout potential above $0.28–$0.31
Analysts expect XLM to target the $0.31–$0.34 range within the next 2–4 weeks, a potential 24–36% upside, if volume expands and the broader crypto market remains stable. A break below $0.22 would invalidate the bullish thesis.
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As Wall Street experiments with Stellar’s blockchain, institutional utility could become a significant driver for XLM’s long-term valuation. With new banking-grade use cases emerging, Stellar’s relevance in the digital-asset ecosystem continues to grow, positioning XLM for potential year-end strength.
Cover image from ChatGPT, XLMUSD chart from Tradingview
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