From tokenized deposits to stablecoin pilots, large US banks have been quietly rolling out blockchain experiments. To critics, this represents modernization. To Fitch Ratings, it is a potential source of instability.
Fitch says banks expanding into digital assets could face ratings pressure. Stablecoins and tokenized services may add revenue but amplify risk. Regulatory clarity remains incomplete, especially around systemic effects.
The agency argued that while these ventures can open new revenue channels, they also embed risks that banks may be underpricing — ranging from reputational blowback to liquidity shocks and compliance failures.
Crypto Exposure Could Weaken Financial Profiles
Fitch’s latest commentary suggests that banks embracing digital asset services may face credit consequences if those programs expand without rigorous safeguards. The firm said improving regulation in the US makes crypto handling somewhat safer, but not safe enough to neutralize threats tied to volatile markets and custodial vulnerabilities.
The biggest concern, according to Fitch, is that digital assets require banks to manage challenges they have limited experience with — security of decentralized systems, opacity around ownership, and the unpredictable behavior of crypto users.
Stablecoins Become a Systemic Question, Not Just a Product
The agency also singled out stablecoins as an emerging point of systemic risk. With players like JPMorgan, Citi, Wells Fargo and Bank of America already dabbling in blockchain-based money, Fitch warned that widespread stablecoin circulation could touch core parts of the financial system — including Treasury liquidity.
Should that happen before regulation catches up, Fitch believes the consequences could ripple far beyond the banking sector itself.
Warning Shot for Banks Accelerating Into Crypto
The message is clear: innovation does not exempt banks from risk assessment. Fitch said it may reassess credit outlooks for institutions whose digital ventures expand faster than their controls or supervision frameworks. In the agency’s view, the benefits of blockchain adoption only outweigh the hazards when volatility, custody, and compliance challenges are fully addressed.
Until then, rapid crypto involvement may not lift banks — it may undermine them.