From student loans to blockchain! SoFi issues USD stablecoin, directly connecting to corporate cash flow with SoFiUSD

The First National Bank in the US to Enter Public Blockchains, SoFiUSD Targets Instant Settlement Market

American Fintech Giant SoFi Technologies (SOFI) Officially Announced on Thursday (12/18) that it will issue a USD stablecoin called $SoFiUSD through its banking subsidiary SoFi Bank. This move signifies that this company, originally known for student loans, is taking a major step into the blockchain financial infrastructure industry.

As a federally licensed and FDIC-insured national bank, SoFi Bank becomes the first nationwide bank in the US to provide stablecoin infrastructure on a public, permissionless blockchain. This milestone marks a significant step in the integration of traditional finance and cryptocurrencies.

According to official information, $SoFiUSD is pegged 1:1 to the US dollar and is initially deployed on the Ethereum network, using the widely compatible ERC-20 token standard, meaning it can seamlessly integrate with most digital wallets on the market today.

Unlike stablecoins issued by native crypto companies, $SoFiUSD emphasizes its banking-level compliance and security, aiming to provide faster, lower-cost capital flow solutions for banks, fintech companies, and enterprise platforms.

A spokesperson for SoFi confirmed that although the stablecoin is currently only used for internal settlement, it is expected to be gradually opened to SoFi’s large membership base in the coming months, allowing general users to also use the service for transactions.

The launch of this product is not only a step for SoFi to expand its cryptocurrency footprint but also a display of its ambition to redefine banking settlement systems. By introducing blockchain technology into a regulated banking system, SoFi is breaking the traditional financial sector’s conservative attitude toward digital assets and offering a new option that combines security and efficiency to the market.

Transforming into a Financial Infrastructure Provider to Solve Traditional Cross-Border Payment Pain Points

SoFi CEO Anthony Noto described blockchain as a “Technology Super Cycle” in a statement, emphasizing that this technology will fundamentally change how the financial industry operates. Its influence will extend beyond payments to all levels of currency circulation.

Noto pointed out that current enterprises face many pain points in financial services, such as slow settlement, dispersed vendors, and unverified reserve models. SoFi is leveraging the infrastructure built over the past decade to address these real-world challenges.

Source: CNBC SoFi CEO Anthony Noto

Through $SoFiUSD, partners can utilize SoFi’s banking-grade infrastructure to seamlessly integrate stablecoins into existing payment and settlement processes, enabling 24/7 capital movement with transaction costs of just a few cents, and near-instant speed.

Additionally, this infrastructure opens the door for “white-labeling,” meaning other banks, card networks, or software companies can use SoFi’s technology to issue their own branded stablecoins or embed $SoFiUSD into their ecosystems. This “Infrastructure-as-a-Service” model is expected to significantly reduce the time and costs of cross-border transactions and corporate fund management, transforming SoFi from a mere service provider into a key backbone of underlying technology in the competitive fintech market.

This also responds to market demand for high-performance payment tools, especially in traditional remittance and B2B payment industries, where blockchain technology can effectively eliminate delays and high costs caused by intermediaries.

Leveraging Federal Reserve Accounts for Zero-Risk Reserve Assets with Yield Potential

In terms of transparency and security of reserve assets, which are most scrutinized in stablecoins, SoFi fully utilizes its regulatory advantage as a national bank. According to official statements, $SoFiUSD is 100% backed by cash and cash equivalents, including U.S. Treasury securities, repurchase agreements, and cash deposits.

Most importantly, as a federally chartered bank, SoFi can deposit these cash reserves directly into its account at the Federal Reserve. This feature greatly reduces liquidity and credit risks, ensuring users can redeem 1:1 at any time.

To further enhance trust, the company commits to having independent third-party auditors issue monthly attestation reports on the reserve assets in accordance with GAAP, ensuring transparency and compliance.

It’s worth noting that this reserve model is not only secure but also capable of generating yields. SoFi states that since the reserve assets are held in Federal Reserve accounts, they can earn interest, and the company plans to share this “attractive yield” with partners holding $SoFiUSD .

This sharply contrasts with some market players issuing less regulated stablecoins, emphasizing SoFi’s leadership in compliance and security, aiming to attract institutional clients still cautious about traditional cryptocurrencies amid increasing regulation.

Integrating Galileo Payment Ecosystem, from Retail Transactions to Enterprise White-Label Applications

The launch of $SoFiUSD is not just a product release but a key step in SoFi’s integration of its extensive financial ecosystem.

In recent years, the company has actively acquired firms like Technisys and Galileo to strengthen its backend processing capabilities. These platforms now provide payment and financial infrastructure services to many fintech companies worldwide. Incorporating $SoFiUSD into the Galileo and Technisys networks will create a closed-loop payment system, enabling billions of transactions to settle in a very short time.

On the consumer side, SoFi is also rebooting its cryptocurrency business. After suspending related services in 2023, SoFi reopened crypto trading in November after receiving a letter of interpretation from the Office of the Comptroller of the Currency (OCC), allowing its 7 million members to buy, sell, and hold 30 crypto assets including Bitcoin ($BTC), Ethereum ($ETH), and Solana ($SOL).

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$SoFiUSD will play a core role in this trading business and will also be applied in SoFi Pay’s international remittances, point-of-sale (POS) payments, and other scenarios. This comprehensive integration from enterprise settlement to end-user applications demonstrates SoFi’s ambition to bridge the gap between traditional finance and digital assets.

By using stablecoins as a linking element for its services, SoFi not only enhances platform efficiency but also provides partners with an accessible entry point into the digital asset world, helping to promote the adoption and application of blockchain technology in mainstream finance.

Stock Price Surged Over 70% in Six Months, Traditional Banks Embrace Stablecoins as a Major Trend

Following the news of SoFi entering the stablecoin market, the market responded enthusiastically, with its stock (NASDAQ: SOFI) rising about 4.04%. Since the beginning of the year, SoFi’s stock has surged over 70.71%, reflecting investor confidence in its cryptocurrency strategy. As of press time, SoFi’s stock price is $26.29.

Source: Google Finance SoFi stock price increase after entering stablecoin market, market response was enthusiastic, rising about 4.04%

This move also occurs against the backdrop of a gradually clearer US regulatory environment. With the advancement of legislation like the GENIUS Act, major US banks are exploring blockchain applications. For example, JPMorgan has already launched JPM Coin on the Base chain, while US banks, Citigroup, Western Union, and Interactive Brokers are also evaluating stablecoins’ potential as payment and settlement tools.

However, the banking industry is not without concerns. Some banking groups have warned that yield-bearing stablecoins could drain deposits from traditional banks. Nevertheless, SoFi, with its unique banking license and tech DNA, has chosen a different path: issuing compliant stablecoins directly on the public blockchain.

As SoFi claims it will adopt an “aggressive” cryptocurrency expansion strategy under the Trump administration, this digital asset revolution led by traditional financial institutions is bound to cause greater waves in the future global capital markets. SoFi’s success or failure will be a key indicator for other financial institutions considering follow-up actions and will profoundly influence the evolution of global financial infrastructure in the coming years.