Among the challenges confronting digital payments is deciding which forms of digital money belong inside the banking system, which belong alongside it, and how those pieces connect without creating new operational or regulatory blind spots.
During a “What’s Next in Payments” interview with David Trecker, vice president and head of strategy, digital assets at FIS, the executive described an ecosystem where several forms of digital money will coexist, each serving different business needs.
“You have to cover the waterfront because so much of the value of digital assets is the interoperability between the different types,” Trecker said. “How much focus you put on one versus the other really depends primarily on two things: what geographies you’re focused on and the customer segments you’re focused on.”
While central bank digital currencies have little momentum in the United States, Trecker said banks operating in Europe cannot ignore initiatives such as the digital euro. Financial institutions therefore face a planning exercise that is less about selecting one technology than preparing for several.
Banks also confront another balancing act. Stablecoins have established legitimate payment and settlement use cases, particularly for moving money and holding U.S. dollars outside the United States. At the same time, banks remain focused on protecting deposits, which remain the foundation of their funding model.
“Stablecoins can do things that commercial bank money can’t,” Trecker said. “Banks are now faced with a choice.”
They can either adopt stablecoins to deliver those outcomes for their customers, or they can find a viable alternative that can still deliver those things, but works with their business model, he told PYMNTS.
That thinking underpins the Keystone Network, a bank-owned initiative built around tokenized deposits while recognizing that community and regional institutions require a different roadmap than the nation’s largest financial institutions. Trecker argued that those banks need practical business enablement as much as they need blockchain infrastructure.
Network Design May Matter More Than Technology
Much of today’s digital asset discussion centers on cross-border payments, wholesale settlement and multinational treasury operations. Trecker suggested that focus overlooks where many banks can generate value sooner.
Large global institutions already have natural applications for digital assets because they manage liquidity across jurisdictions and time zones. Continuous settlement and programmable treasury operations solve existing operational problems.
Regional and community banks operate under different conditions.
Rather than beginning with multinational treasury management, Trecker pointed to smart deposits, programmable commercial banking services, intra-bank liquidity management and tokenized real-world assets as examples where digital assets can produce measurable benefits without requiring a massive external network. Those projects allow institutions to gain operational experience before tackling broader interoperability across the industry.
He described that progression as moving from “single-player games” toward hub-and-spoke models before reaching broader network participation. Interbank settlement, correspondent banking and foreign exchange become more practical as banks establish trusted relationships among smaller groups of participants that share common objectives.
Trecker also said banks should pay close attention to customer behavior rather than waiting for perfect return-on-investment models before acting. He compared today’s environment with the early years of online banking, when customer expectations shifted before many institutions could produce traditional financial justifications for digital investment.
“The banking leaders of today all have seen a version of this movie before,” Trecker said. “The customers wanted it, and those who did not have it moved.”
That lesson carries particular weight for regional institutions accustomed to following larger competitors. Trecker questioned whether digital assets represent another cycle where banks can safely wait or whether customer demand will require some institutions to lead rather than follow.
Trecker noted that banks require clear accountability, consistent know-your-customer and Bank Secrecy Act controls, defined liability frameworks and complete transaction visibility before connecting with outside networks.
His broader advice for the industry centered on collaboration. Banks, particularly community and regional institutions, should view one another as natural partners rather than approaching digital assets solely through competitive positioning. Building larger banking networks around common standards, he said, offers a stronger long-term foundation than fragmented initiatives pursuing isolated use cases.
Watch the full interview with David Trecker to learn more about:
- Why banks should recognize different forms of digital money as complementary rather than competing technologies.
- How customer behavior may become a stronger adoption signal than traditional ROI calculations.
- Why community banks and regional institutions could shape digital asset adoption through shared networks focused on domestic banking needs.
