Citi Clients Can Now Take Stablecoin Payments via Coinbase

Citi has expanded its partnership with Coinbase, meaning Citi clients can now take stablecoin payments and utilize virtual accounts for fiat-to-stablecoin conversions. This collaboration allows institutional clients to accept stablecoin payments without directly holding the digital assets themselves.

The updated agreement integrates Coinbase's payment infrastructure with Spring by Citi, the bank's merchant payment platform. This enables Citi's institutional clients to accept stablecoins at checkout. Coinbase handles the conversion of stablecoins into fiat currency, with Citi serving as the bank of record for fund settlement.

Coinbase has incorporated Citi's Virtual Account Wallet, part of the bank's banking-as-a-service offering, to power its own Coinbase Virtual Accounts. These accounts allow businesses on Coinbase to manage funds similarly to traditional bank accounts, automatically converting incoming fiat currencies, such as U.S. dollars, into stablecoins.

Both new features are initially launching in the U.S., with plans for additional capabilities in the coming months. Coinbase estimates a potential global audience of over 150 million stablecoin holders. Brett Tejpaul, head of Coinbase Institutional, emphasized the importance of regulated banking partners like Citi for the digital asset economy's transition from experimental use to everyday commerce.

This expansion builds on a partnership announced in October 2023, which focused on streamlining fiat on- and off-ramps for Citi's institutional clients. Citi has been increasing its involvement in digital assets, including plans to add Bitcoin custody to its Custody+ suite.

Coinbase has also diversified its offerings beyond trading. The platform recently introduced fixed-rate USDC loans against Bitcoin and tokenized stocks on its Base network for non-U.S. users, indicating a broader strategic move into various digital asset services.