Citigroup is teaming up with Coinbase, the largest cryptocurrency exchange in the United States, on its latest blockchain-based venture.

The two companies announced in a joint statement on Monday that they are collaborating to allow Citi clients to move between conventional money and stablecoins without having to build or manage both banking and crypto systems themselves. Stablecoins are digital tokens designed to hold a steady value against a reference asset, most often a government-issued currency like the U.S. dollar, and have emerged as a common tool for moving money over blockchains.

The announcement arrives as banks worldwide put Bitcoin's underlying technology to work, speeding up their processes and catering to customers with growing appetites for crypto services. For traditional lenders, the draw is combining blockchain-based rails with the regulated banking backbone that corporate customers would otherwise have to build themselves — precisely the gap this partnership is structured to address.

Citi said last month that it plans to let institutional investors custody both traditional assets and bitcoin within a single framework, rather than requiring separate systems, later this year.

"Our clients operate in an increasingly fast-paced and complex global economy, and we're focused on delivering the solutions they need," said Debopama Sen, Head of Payments, Services, at Citi. "Our goal is to build the next generation of payments infrastructure — one that is seamless, interoperable, and operates across both traditional and digital payments instruments and networks."

The partnership has two components, according to the announcement. First, Coinbase Virtual Accounts, built on Citi's banking-as-a-service platform, will give Coinbase's payments customers bank-account-like features so they can accept, hold, and send funds. Citi will provide the regulated banking backbone, allowing incoming fiat to be automatically converted into stablecoins.

Second, Spring by Citi, the bank's merchant platform, will draw on Coinbase's infrastructure so that Citi's enterprise clients can accept stablecoin payments at checkout. Coinbase will convert the stablecoins into fiat, and Citi will settle the funds — meaning merchants never have to hold or manage crypto directly.

"Fintechs building on Coinbase have always needed a fast, compliant bridge between fiat and stablecoins, and Citi gives us that at scale," said Alec Lovett, Coinbase's Head of Infrastructure Product.

Coinbase and Citi first announced last year that they would partner to enhance digital asset payment capabilities for institutional clients.

Citi operates a number of blockchain offerings, including Citi Token Services, which enables real-time cross-border payments using tokenized deposits. Since last year, the firm has also been working with other top banks — including Deutsche Bank, Goldman Sachs, and Bank of America — to explore issuing a stablecoin product. How those pieces fit together — the custody framework slated for later this year, the multi-bank stablecoin exploration, and the payments rails now being built with Coinbase — will shape how easily Citi's corporate and institutional clients can operate across both digital and fiat money.

This article first appeared on Bitcoin Magazine and was written by Mathew Di Salvo.