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Reading: Bank of America explains why it is against stablecoin rewards
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Your Crypto News Today > Market > Bank of America explains why it is against stablecoin rewards
Market

Bank of America explains why it is against stablecoin rewards

January 16, 2026 5 Min Read
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Bank of America explains why it is against stablecoin rewards

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  • The concern in banks about stablecoins is starting to be felt
  • The way forward for digital asset regulation within the US
  • For Moynihan, commissions could be lowered and they might lose enterprise for his or her conventional merchandise.

  • Banks are already beginning to get terrified of stablecoins, says lawyer.

Brian Moynihan, CEO of Financial institution of America, acknowledged that stablecoins characterize a direct menace to the financial institution’s deposit base. This, estimating a potential leak of as much as USD 6 trillion in direction of these digital devices if restrictions are usually not utilized to the cost of returns.

Through the presentation of the financial institution’s outcomes for the fourth quarter of 2025, Moynihan emphasised that the principle downside is just not solely competitors for capital, however the macroeconomic affect.

In line with the chief, if deposits migrate to the stablecoin setting, the system loses lending capability. This primarily impacts small and medium-sized firms that depend upon financial institution credit score.

“In the event you take away the deposits, both they won’t be able to lend, or they must acquire wholesale financing at a price that may improve the worth of the loans,” the supervisor warned.

Nevertheless, not all analysts agree with Moynihan’s narrative. BitMEX Analysis has questioned the premise that loans rely instantly on earlier deposits in giant banks.

In line with the researchers, for establishments on the dimensions of JP Morgan or Financial institution of America, granting a mortgage or making an expense typically finally ends up growing its personal deposits. It is because recipients usually function throughout the identical system or maintain interbank deposits.

“The restriction on financial institution spending is the capital ratio, that’s, how a lot capital the financial institution has,” they level out from BitMEX Analysis. On this gentle, full-reserve stablecoins and banks that maintain 100% of their clients’ deposits in liquid reserves function essentially in another way than the present fractional reserve system. This, they are saying, explains the resistance of conventional banking to this new mannequin.

The concern in banks about stablecoins is starting to be felt

The background to this dispute lies within the GENIUS Act (handed in 2025) and the current debate over the CLARITY Act, whose overview was postponed on January 14, 2026.

Though present rules try to restrict direct curiosity funds, the digital asset trade has managed to supply rewards by means of companions and exchanges, one thing that banks describe as a “authorized loophole.”

On this regard, Haider Rafique, advertising director of the OKX change, identified that what Moynihan omits is the shopper perspective. «Individuals transfer as a result of banks don’t supply a good return. Stablecoins do. “Expertise is exposing that hole and clients are selecting accordingly,” he mentioned.

For her half, the Spanish lawyer Cristina Carrascosa noticed that The banking sector is lastly displaying indicators of actual concern. “Their commissions could be lowered and they might lose enterprise for his or her conventional merchandise,” he mentioned.

«A very long time in the past I mentioned that the banks would find yourself getting scared by this; Nicely, they’re already feeling a bit scared,” he added.

The way forward for digital asset regulation within the US

The banking sector, represented by teams such because the American Bankers Affiliation (ABA), pressures Congress to ban not solely curiosity, however any sort of reward related to holding stablecoins.

They argue that these property, by functioning equally to cash market mutual funds, They drain the liquidity that sustains the true economic system.

In the meantime, main firms like Coinbase have withdrawn their help for brand new legislative proposals that search to learn banking on the expense of innovation.

The state of affairs for 2026 means that the battle for deposits will outline the subsequent regulatory framework for digital property in the USA.

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TAGGED:Banking and InsuranceCryptocurrenciesFeaturedFinanceMarketStablecoinUnited States
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