Citigroup has teamed up with Coinbase to let its institutional clients accept stablecoin payments from customers without building their own crypto infrastructure.
Stablecoins are cryptocurrencies designed to hold a steady value, usually by tracking the US dollar.
Under the deal, Citi's corporate clients, including large multinationals, can accept stablecoins at checkout through the bank's merchant payment services.
Coinbase, the largest US crypto exchange, converts the tokens into dollars, and Citi settles the funds as the bank of record, so merchants never have to hold or manage crypto themselves.
It works in reverse, too.
Coinbase's payment customers get access to Citi banking tools that work much like a standard bank account, with incoming cash automatically converted into stablecoins that sit at Coinbase and earn an annual reward of 3.75%.
Why Citi is doing it
The simplest answer is reach.
Citi says the service lets merchants serve more than 150 million stablecoin holders worldwide without holding or managing digital assets.
Shahmir Khaliq, Citi's head of services, described the move as an effort to connect digital assets with the parts of the economy that still run on government-issued currency, calling it part of "completing that jigsaw puzzle".
Cross-border payments are the other prize.
Citi's payments network spans 94 markets and more than 300 clearing systems, and stablecoins promise to move money across borders faster and more cheaply than traditional bank transfers.
The bank also earns a role at the centre of the crypto economy, providing regulated banking infrastructure for a major crypto platform rather than ceding that ground to fintech rivals.
At the same time, Citi is expanding its own blockchain service for corporate cash transfers, which is now live in seven jurisdictions after adding Japan and the United Arab Emirates.
An awkward reward
The deal sits uneasily with the banking industry's lobbying.
Bank groups, including the Financial Services Forum chaired by Citi chief executive Jane Fraser, have lobbied Congress to ban stablecoin rewards like the 3.75% Coinbase pays, arguing they could drain deposits from traditional banks.
Citi is now effectively a distribution partner for the kind of product that lobby wanted outlawed.
It is pressing ahead even after the CLARITY Act, the bill that would set rules for US crypto markets, failed to advance in the Senate.
Still early days
The partnership extends a collaboration first announced in October 2025, which initially focused on moving money between bank accounts and Coinbase.
Citi has not named any merchants using the service or given a launch date.
The Wall Street Journal, which first reported the deal, published no fee schedule, list of supported tokens or expected volumes.
