Major Banks Test Crypto Tools While Lobbying Against Them
A quiet shift is taking place inside America’s largest banks: crypto is no longer something they’re watching from a distance.
According to Coinbase CEO Brian Armstrong, several major institutions are already testing stablecoin integrations, digital-asset trading tools, and crypto-custody services — all behind closed doors.
Armstrong revealed the development during a live conversation at The New York Times DealBook Summit, where he shared the stage with BlackRock CEO Larry Fink. While the two have disagreed sharply in the past, their views aligned more than expected as they discussed Bitcoin and the direction of digital assets.
BlackRock’s Growing Footprint Changes the Mood
Much of the event’s surprise came from Fink’s tone. A longtime critic, Fink now says Bitcoin clearly serves a purpose, even if leveraged traders still distort its behavior.
His firm isn’t speaking in theory: BlackRock’s iShares Bitcoin Trust (IBIT), launched in early 2024, has become the largest spot Bitcoin ETF in existence, with more than $72 billion in market cap.
BlackRock is also rewriting the tokenized-Treasury race. Data from RWA.xyz shows the asset manager controlling around $2.3 billion in tokenized U.S. government debt — more than any other issuer.
Banks Want In — But Only on Their Terms
Despite Armstrong’s comments about cooperation, the banking sector has been openly trying to contain the influence of Coinbase and stablecoins.
The conflict escalated in August, when the Banking Policy Institute — chaired by JPMorgan CEO Jamie Dimon — urged lawmakers to restrict stablecoin usage. The group warned that a large shift of deposits into stablecoins could shrink the credit available to businesses and raise borrowing costs.
Their biggest complaint involves the GENIUS Act. The law prevents stablecoin issuers from offering yield — but it doesn’t stop platforms like Coinbase from offering rewards on those same stablecoins. Banks call it a loophole; Coinbase calls it competition.
Coinbase’s Vision Is the Real Threat
Armstrong hasn’t been subtle about his goals.
In a September interview with Fox Business, he said Coinbase aims to evolve into a “super app” offering payments, credit cards, rewards, and financial services that bypass traditional banks altogether. He pointed to routine credit-card fees as evidence that the current system is outdated, arguing that blockchain rails can deliver similar services at far lower costs.
Tensions Hit a New Peak
The friction intensified again in November.
The Independent Community Bankers of America petitioned regulators to block Coinbase’s application for a national trust charter, claiming its crypto-custody approach has not been proven safe.
Coinbase’s chief legal officer Paul Grewal fired back on X, accusing bank lobbyists of trying to wall off innovation:
“Another case of building regulatory moats to protect their own,” he wrote, arguing that these campaigns have nothing to do with consumer safety.
Banks are experimenting with crypto, partnering with Coinbase behind the scenes — and simultaneously lobbying against Coinbase in public.
BlackRock, meanwhile, is accelerating into Bitcoin and tokenized assets at full speed. As crypto becomes more embedded in mainstream finance, the divide between collaboration and competition is shrinking fast.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
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