The post First U.S. Bank Issues Stablecoin on a Permissionless Blockchain appeared on BitcoinEthereumNews.com.

Key Takeaways: Custodia and Vantage Bank announce the first bank-issued stablecoin in the U.S., marking continued progress for regulated digital currency. Avit is an Ethereum-based stablecoin that provides a fully compliant and auditable way to tokenize U.S. dollar deposits inside — not outside — the banking system. This groundbreaking advancement opens new avenues in the intersection of blockchain technology and traditional finance, paving the way for seamless and transparent payments in the future. Custodia, in conjunction with Vantage Bank, recently introduced the first-ever U.S. bank-issued stablecoin— designated Avit — allowing it to operate across a permissionless blockchain. The launch, which was completed yesterday, marks the tokenization of U.S. dollar demand deposits on the Ethereum network, ushering in a new era for regulated digital currencies. Introducing a New Era of U.S. Dollar Payments on Blockchain Avit’s successful launch establishes a new payment rail in the U.S. banking system, designed to meet the growing global demand for secure, compliant U.S. dollar stablecoins. This revolution in digital payments addresses inefficiencies in existing behind-the-scenes systems, replacing them with more transparent and technology-driven methods. By leveraging blockchain’s immutable ledger, Avit ensures greater accountability in transactions, reducing reliance on intermediaries and enhancing financial transparency. The deal was based on Custodia’s 2022 patent for dollar bank deposit tokenization on permissionless smart-contract platforms. In a series of test transactions, all involved parties realized significant efficiencies, such as: Lower transaction costs Faster settlement times Enhanced programmability Comprehensive auditability These benefits are realized in a safe, compliant, and regulated banking system. A Deeper Look into Avit Stablecoin Functionality This collaboration enabled the minting, transfer, and redemption of Avit tokens for a bank customer on the Ethereum mainnet, based on the ERC-20 standard. This process involved eight complex stages. These processes were managed by Vantage Bank, which also provided Fedwire/ACH services for…

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Filed under: News - @ March 27, 2025 7:24 pm