Part 2: Banks Spend Heavily on Blockchain Innovation
Global banks are making their move
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Today’s news that Citibank and JPMorgan are pursuing both stablecoins and deposit tokens proves how banks are finally diving into blockchain and investing heavily.
This report by Ripple, CB Insights, and UKCBT shows how nearly a decade after the blockchain craze first broke in 2016, banks are putting production blockchain systems to work and making serious investments.
The rationale for bank involvement in blockchain is clear: 90% of global finance leaders believe blockchain and digital assets will have a significant or massive impact on finance.”
In the early days, banks looked at blockchain as though it were a toy or gimmick, and most stated that it was unsuitable for banks. Their blockchain projects were nothing more than “innovation theater” that no one took seriously.
A decade later, they see it as a “foundational pillar” that will take them into the next era of banking just as computers, telephones, the internet, and mobile banking did in decades prior.
Blockchain is nothing short of an essential financial infrastructure that brings with it 24/7/365 markets, automation for manual processes like settlement and reconciliation, improves liquidity of financial assets, and provides additional revenue streams through new digital asset use cases.
This leaves me with one burning question.
Who among us who was working with banks on blockchain back in 2016 is going to tell banks: “I told you so!”
👉Blockchain and Banks by the Numbers:
🔹 Funding to stablecoin companies is projected to increase tenfold in 2025 compared to 2024 levels per CB Insightsʼ data.
🔹 From 2020-2024 global banks took part in 345 investments in blockchain companies.
🔹 Of the 33 mega-round deals, the use cases that garnered high levels of interest included: institutional infrastructure related to trading, staking, and tokenization (27%); payments (24%); and digital asset custody (21%).
🔹 Global Systemically Important Banks (G-SIBs) made 106 investments in blockchain companies.
🔹 G-SIBs participated in 14 mega-round deals ($100M+)
🔹 18 investment deals made by Citigroup and Goldman Sachs
🔹 15 investment deals made by JP Morgan Chase and Mitsubishi EFJ Financial Group
🔹 Overall, between 2020-2024, over $100B was invested in blockchain companies across more than 10,000 deals.
🔹 The majority of blockchain companies that attracted funding are based in the U.S., followed by Singapore, Canada, and the UK.
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