Citi has expanded its collaboration with Coinbase to integrate traditional banking rails with digital asset platforms.
The partnership provides corporate and institutional clients with scalable on and off ramps for stablecoin payments, removing the need for businesses to build separate blockchain infrastructure.
The collaboration centres on two main initiatives, which are launching first in the US.
Launching first in the US, the initiatives form part of a broader effort to bridge traditional finance and digital assets. The collaboration also supports Citi’s strategy to develop end-to-end payments solutions for the digital economy.
Coinbase has selected the Citi Virtual Account Wallet to power its new Coinbase Virtual Accounts. The product is part of the Banking as a Service offering from Citi.
This integration provides payments customers on the Coinbase platform with functionality similar to a traditional bank account. Users can accept, hold, and pay funds, while incoming fiat currency is automatically converted into stablecoins.
Through its integrated payment acceptance platform Spring by Citi, the bank is enabling institutional clients to accept stablecoin payments at checkout.
Coinbase Payments processes the stablecoin transactions and automatically converts the digital currency into fiat. Citi then settles the funds as the bank of record.
This arrangement allows merchants to receive payments from stablecoin users globally without having to custody or manage the digital assets directly.
“We provide regulated, bank-grade solutions that remove significant hurdles for clients who want to engage in the digital economy, while also providing a foundational service for a leading virtual asset service provider like Coinbase.”
said Shahmir Khaliq, Head of Services at Citi.
Alec Lovett, Head of Infrastructure Product at Coinbase, noted that businesses building on their platform require a reliable connection between traditional and digital finance.
“Clients building on Coinbase have always needed a fast, compliant bridge between fiat and stablecoins, and Citi gives us that at scale,”
Lovett said.
Featured image credit: Edited by Fintech News Singapore, based on image by digitizesc via Magnific
