Fidelity Investmentsone of the largest asset managers on the planet, announced on Wednesday that it will launch its own stablecoin. Like other stablecoins, Fidelity’s token—known as the Fidelity Digital Dollar or FIDD—is fully backed by reserves to ensure it maintains a 1-to-1 peg to the dollar. The company says FIDD will be available from Fidelity and the exchanges in the coming weeks, and it will be available to institutional and retail clients.

“As overall adoption in the digital asset space continues to grow, we feel this is the logical next step for the market and our clients,” said Mike O’Reilly, President of Fidelity Digital Assets, in a statement on luck.

The arrival of FIDD comes almost a year later reports that Fidelity is testing a stablecoin, despite at the time the company stated that it had no plans to launch one.

Fidelity is known primarily as an upscale brokerage and asset manager that deals in traditional offerings such as stocks and bonds. At the same time, it stood out in the early days of crypto as one of the first mainstream financial companies to embrace blockchain under longtime CEO Abigail Johnson, and even dabbled in Ethereum mining as early as 2014.

In announcing the launch of FIDD, O’Reilly touted the company’s long-standing experience in digital assets as a competitive advantage. This may be important at a time when the stablecoin market is becoming more competitive, and as it is developing rapidly after the recent passage of the Genius Act, a key piece of legislation that provides a regulatory framework in the US for digital dollars.

Currently, the total market for all stablecoins is at $315 billion. Market leader Tether has long dominated the sector with its flagship USDT token which now accounts for nearly 60% of all stablecoins. Almost all of Tether’s operations, however, are almost entirely overseas. In the United States, the clear leader of the stablecoin is roundwhose USDC token currently has a market cap of around $72 billion.

The business of stablecoins has historically been lucrative because the issuers of the tokens have traditionally kept all the interest generated on the billions of dollars they hold as reserves. That model is now evolving, however, as companies want Coinbase push to share stablecoin yields with their customers to promote technology adoption. The legality of doing so, however, remains murky as does the fate of a follow-up bill known as the Clarity Act—which has huge potential implications for stablecoins—remains unclear.

In any case, Fidelity will be challenged to build traction for its new FIDD token. In the last two years, other prominent financial players, including PayPal and Ripplehave launched stablecoins of their own, but none have managed to reach even 10% of Circle’s market cap. The space has become more competitive as Tether this week launched a version of its stablecoin known as used which complies with US regulations.

Loyalty, however, appears to believe in several key areas of the fast-growing stablecoin market. In its announcement, the company pointed to its expertise in reserve management—suggesting that the company may seek to manage stablecoins issued by other companies as well as its own.

Owning its own stablecoin could also make Fidelity’s various wealth management platforms more efficient because transferring dollars on a blockchain is cheaper and faster than using traditional networks like ACH.

Fidelity’s O’Reilly, on the other hand, also indicated that the company envisions a role for stablecoins in its trading and retail brokerage operations.

“Many companies use stablecoins as a settlement mechanism on crypto platforms, and stablecoins have the benefit of supporting liquidity for providers and companies 24/7/365; done at a low cost, in a low-friction environment,” he said. On the retail side, stablecoins can be used as payment in DeFi networks and used as a dollar-backed, one-to-one usage system.

This story was originally featured on Fortune.com

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