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A group of US banks have plans to jointly launch a large stablecoin. This is supposed to be the name USDF to receive. The objective of this initiative is, among other things, to dispel the doubts that are harbored about other stablecoins in terms of reserves with your own stablecoin. Founding members of the USDF consortium include Sinovus (48th largest bank in the US by assets according to MX Technologies), the Community Bank of New York (No. 45), the First bank (No. 88) and the sterling national bank (No. 77). They are covered by the Federal Deposit Insurance Corporation (FDIC), one of the most important regulators in the industry.
The consortium would also like to encourage other financial institutions to join.
USDFs are minted exclusively by US banks and can be exchanged 1: 1 for cash from a consortium member bank. Addressing consumer and regulatory concerns with non-bank stablecoins, the USDF offers a more secure option for transactions on the blockchain.
it says in the message.
USDF runs on publicly-sourced blockchain
Banks will operate the USDF stablecoin on the publicly-sourced blockchain. The availability of USDF on a public blockchain brings some benefits. For this reason, banks and their clients can use stablecoin for a wide range of other applications in addition to business-to-business and peer-to-peer money transfers. These scenarios include, for example, capital calls or billing and supply chain financing.
However, the communication omits whether the reserves for the USDF are also covered by the FDIC. In the case of Tether in particular, there were multiple concerns about the opaque nature of the stablecoin cover.
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