Stablecoins Are a Bigger Threat to US Banks Than Regulators Admit: Standard Chartered
Standard Chartered projects that by 2028, approximately $500 billion will move from traditional bank deposits into stablecoins. This is a decrease from a previous $1 trillion estimate. The shift is influenced by potential U.S. regulatory changes under discussion, specifically the CLARITY Act, which could determine whether stablecoins may offer yield to holders. If allowed, stablecoins offering yield could further drive funds away from banks. Reduced bank deposits threaten net interest margin (NIM) income, a key revenue source, especially for regional U.S. banks that rely heavily on NIM, while investment banks are less exposed. The impact on banks may be mitigated if stablecoin issuers keep their reserves as deposits within the banking system, maintaining overall deposit levels despite shifts into stablecoins.
