Fidelity to Enter Stablecoin Market With Ethereum-Based ‘Digital Dollar’

BOSTON, MA — Fidelity Investments has announced its highly anticipated entry into the stablecoin market, confirming plans to launch an Ethereum-based digital asset pegged 1:1 to the U.S. dollar. The initiative, spearheaded by Fidelity Digital Assets (FDA), signifies a major strategic pivot aimed at capturing institutional demand for regulated, highly liquid digital fiat proxies. The new stablecoin, provisionally dubbed the ‘Fidelity Digital Dollar’ (FDD), will operate as an ERC-20 token on the Ethereum network, ensuring broad interoperability across decentralized finance (DeFi) platforms.

Industry analysts suggest Fidelity’s move is driven by a desire to establish a compliance-focused market leader in the stablecoin space. Unlike many current market offerings, the FDD will reportedly feature quarterly third-party audits confirming 100% reserve backing, held primarily in cash and short-term U.S. Treasury obligations. This emphasis on transparency is designed to appeal directly to traditional financial institutions concerned about the reserve practices of existing stablecoin issuers.

A spokesperson for FDA noted that the launch is contingent upon final regulatory review, but preparation is well underway, with an expected rollout late in the fourth quarter. The stablecoin will initially focus on institutional adoption, facilitating cross-border settlements and efficient collateral management within the growing digital assets ecosystem. This development positions Fidelity as a direct competitor to major players like Circle (USDC) and Tether (USDT), utilizing its established brand trust to carve out a significant segment of the rapidly expanding stablecoin market.

Source: Fidelity to Enter Stablecoin Market With Ethereum-Based ‘Digital Dollar’