Bank of America CEO Brian Moynihan said on the bank’s fourth-quarter earnings call that yield-bearing stablecoins could pull as much as $6 trillion out of U.S. bank deposits. The remark sharpened a debate that is already spilling across banking, crypto policy, and Capitol Hill.
Moynihan said these coins differ from the usual bank model because their reserves are kept in safe assets rather than lent out into the economy. If deposits shift into stablecoins, banks may need to replace that funding with more expensive sources. That would raise the cost of credit for consumers and small businesses. He added that Bank of America would adapt, but the warning was quickly read by crypto supporters as proof that stablecoins are becoming more attractive because they can offer yields above the near-zero rates common in traditional savings accounts.
Why banks see yield-bearing stablecoins as a funding threat
In the article’s framing, stablecoins pegged to a fixed value behave more like money market funds than conventional deposits. The cash sits in secure reserve assets instead of feeding bank lending. That changes the flow of funds through the banking system. A short point, but a central one.
If enough deposits leave, banks lose part of their lending capacity, and smaller institutions could feel the pressure more unevenly. This concern has also shaped lobbying efforts in Washington. Banking groups are pushing Congress to regulate stablecoin yields through proposals such as the GENIUS Act and the proposed CLARITY Act, which, according to the source material, would restrict direct interest while still allowing transaction-based or staking rewards.
CLARITY Act fight deepens after Coinbase steps back
The dispute is closely tied to the Digital Asset Market CLARITY Act. The bill seeks to restrict yields or “rewards” on stablecoins so they do not compete directly with bank deposits. Banks are pressing hard for those limits, while private-sector crypto firms have pushed back.
Brian Armstrong of Coinbase publicly withdrew support for the act a few days earlier, saying it would hurt stablecoin rewards, DeFi privacy infrastructure, and room for innovation. The source says that move led the Senate Banking Committee to delay markup, leaving pro-crypto reform efforts stalled for now. Market experts cited in the material said the shift benefits the traditional monetary system, though continued opposition has kept the rulemaking process in limbo.
Stablecoin growth continues while regulation remains unsettled
Even with the policy fight unresolved, stablecoin usage is still expanding. The article says stablecoins now facilitate more than $1.5 billion in monthly payments and card activity. Interactive Brokers has also added USDC, RLUSD, and PYUSD as account funding options.
By the figures cited in the source, total stablecoin market capitalization is above $310 billion, with 222 million users worldwide. The clash between banks and crypto companies is now centered on a simple question: whether stablecoins can offer returns that make them a real alternative to bank deposits. The answer may shape how these products are regulated and how far they move into mainstream finance.