Banks Can Slow Down Stablecoin Growth With Savings Rates, Study Finds

Could the humble interest rate on your savings account shape the future of digital money? A new study says yes.

Economists at the Bank for International Settlements (BIS) — an organization that acts as a bank for the world's central banks — published a working paper (an early research report, not yet an official position) about stablecoins.

*What is a stablecoin?* It's a type of cryptocurrency designed to always be worth the same as a regular currency, usually $1. Popular examples are USDC (made by Circle) and USDT (made by Tether). People use them like digital dollars.

The key finding: When banks raise the interest they pay on savings accounts (deposit rates), stablecoin growth slows down. In other words, people are more tempted to keep money in the bank when they earn more interest there — and less tempted to move it into stablecoins, which currently pay no interest.

Here are the numbers from the study, which used U.S. data from January 2019 to June 2025:

• Stablecoins normally grew about 15% over a typical 10-week span.
• A tiny rise in bank interest (one basis point, meaning 0.01%) slowed that growth to roughly 12% — or as low as 6% under a stricter calculation.
• The effect was stronger for USDC than USDT, likely because USDC is more closely tied to U.S. users.

Why this matters: The authors suggest regulators should think about whether stablecoin companies should be allowed to pay their holders interest (yield). Right now, U.S. banks are lobbying to keep stablecoins from paying yield, fearing they'd lose customers.

This debate is heating up in Washington as regulators write rules for the GENIUS Act — a law signed by President Trump that legalized stablecoins in the U.S. and takes effect in January.

Bottom line: Banks aren't powerless against the rise of digital dollars. Simply by adjusting savings rates, they can influence how fast stablecoins spread.

This is an AI-generated summary. Read the original article at: https://decrypt.co/381253/banks-hold-a-lever-over-stablecoin-adoption-bis-economists-say