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US banks lobby to block stablecoin interest over fears of deposit flightwww.ft.com/content/7c4746d7-02e8-4c60-a96c-b51eb21a7bf1
236 sats \ 4 comments \ @Coinsreporter 4h econ
Banks fear this would create an uneven playing field and spark mass deposit outflows away from them, if customers choose to earn yield by holding stablecoins at crypto exchanges rather than coins or cash dollars at banks.
A US Treasury report in April estimated stablecoins could drain about $6.6tn of deposits away from banks, depending on whether stablecoins can offer yield, the banking industry representatives said.
They warned of “greater deposit flight risk, especially in times of stress, that will undermine credit creation throughout the economy”.
The fear is real but can banks stop 'stalecoins'? Yes they can only if they build on 'Strategy'.
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21 sats \ 0 replies \ @Undisciplined 4h
@freetx made a really interesting point about how banks lost their political relevance when they got their desired zero reserve requirement passed.
Now, they aren’t the sink for Treasuries that stablecoins are, so deficit spending politicians will cater to the stablecoins.
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0 sats \ 0 replies \ @SevenOfNine 2h
And whose fault is that? Let the banks rot. If they provide an inferior service they deserve to go. They're preying on fear to stay alive at this point.
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0 sats \ 0 replies \ @Entrep 3h
This isn’t just about stablecoins, it’s about trust and efficiency. If banks lose deposits at scale, lending could dry up, hurting small businesses and mortgages.
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0 sats \ 0 replies \ @brave 3h
Fearing disruption isn’t a strategy. If banks want to stop the stablecoin shift, they need to offer better value, higher yields, better UX, and more transparency.
Otherwise, they’ll be relics of the analog financial era.
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