Banks fear stablecoin ‘bank run,’ regulators see limited impact
Banks warn stablecoins could siphon deposits from the banking system, but policy and regulatory experts say there’s little evidence of it happening yet.
Banks warn that stablecoins, especially those paying yield, could pull deposits out of the banking system, but policy and finance experts say there’s little evidence of that so far.
Major US bank Standard Chartered recently estimated in a research note that increasing stablecoin adoption could drain bank deposits. The report estimates “that US bank deposits will decrease by one-third of stablecoin market cap,” which stood at $308.15 billion at time of writing, according to DeFiLlama data.
The debate has intensified as US lawmakers weigh whether to prohibit interest on stablecoin holdings under a proposed version of the crypto market structure bill, or CLARITY Act, which has been delayed by protests from inside the crypto industry despite banking sector support.