Your savings account is quietly at war with stablecoins — and according to new research from the Bank for International Settlements, the banks may be winning more often than you think. A working paper published by the Basel-based “central bank of central banks” found that stablecoin growth slows when U.S. banks raise deposit rates, with Circle’s USDC the most sensitive to the pressure.
By Ana Gonzalez | October 18, 2026
As Decrypt reported Sunday, BIS economist Iñaki Aldasoro and Rashad Ahmed of the Andersen Institute for Finance and Economics analyzed weekly U.S. data from January 2019 through June 2025. Their conclusion: the interest rate on a savings account is a genuine counterweight for banks worried about losing customers to stablecoins.
The Hook: One Basis Point, Three Percent Less Growth
The headline numbers are striking. Over a typical 10-week span in the researchers’ sample, stablecoin market capitalization grew by about 15 percent. A one-basis-point bump in deposit rates — a sizable weekly move for normally slow-moving savings rates — cut that growth to roughly 12 percent under the authors’ baseline estimate. Under a second method designed to isolate cause and effect, growth fell to about 6 percent.
The key nuance: stablecoins kept growing in every scenario, just more slowly. Bank pricing does not stop the stablecoin story — it presses the brake pedal. The paper concludes that banks “retain some influence over the pace of that adoption through deposit pricing.”
On-Chain Evidence: Why USDC Feels It More Than USDT
The link was stronger for Circle’s USDC than for Tether’s USDT — a gap the authors attribute to USDC’s closer ties to U.S. users. That makes intuitive sense: American savers comparing a dollar in a bank account against a dollar in a stablecoin are exactly the customers USDC courts, while USDT’s base skews toward users in markets where the dollar alternative is a local currency, not a savings account.
To separate cause from coincidence, the researchers leaned on a quirk of bank behavior: lenders barely raise savings rates until the federal funds rate passes about 3 percent, and then they reprice much faster. That natural breakpoint let the economists measure what happens to stablecoin flows when bank yields genuinely move — and the effect showed up cleanly.
The Core Conflict: Should Stablecoins Pay You Interest?
Buried in the paper is the regulatory question that matters most: the authors say regulators should weigh whether stablecoin issuers may pay holders yield, along with the trade-offs of requiring issuers to keep part of their reserves in bank deposits.
That debate is not academic — it is live in Washington. As Decrypt notes, banks have lobbied to keep stablecoin yield off the table, a fight that loomed over the Clarity Act’s failed Senate vote. Meanwhile, the OCC, FDIC, and Treasury are writing rules to implement the GENIUS Act, the stablecoin law signed in July of last year that essentially legalized the tokens in the United States and takes effect in January. The researchers’ logic is hard to escape: if bank deposits and stablecoins compete on convenience, yield is the tiebreaker — and whoever controls the tiebreaker controls the pace of adoption.
Market Implications: The Fine Print on a Superpower Study
The caveats deserve respect. Working papers reflect their authors’ views, not necessarily the BIS’s official position. The sample also spans a single high-rate cycle in which stablecoins paid holders no interest — meaning the next cycle could look very different if regulators allow issuers to share yield with customers.
The macro backdrop keeps the stakes high. Circle chief executive Jeremy Allaire said this week, per Cointelegraph, that the issuer is looking to enter 40 developing markets, and a separate report found stablecoin remittances cost 84 percent less than traditional transfers. Stablecoins are also increasingly woven into card networks — Mastercard said Thursday it is bringing stablecoin balances into traditional banking and card payments, per Cointelegraph. For context, bitcoin trades around 81,000 USD and ethereum near 2,374 USD per the latest CoinGecko data, while USDC itself continues to hold its one-dollar peg.
The Verdict: Watch Your Bank, Not Just the Blockchain
For regular investors and savers, the study reframes a familiar question. Stablecoins are not just a crypto asset — they are a rival to your checking account, and your bank’s response is now a measurable economic force. If your bank starts paying noticeably better rates in a high-rate environment, part of the reason may be sitting on-chain.
When the GENIUS Act rules land in January, the yield question will move to center stage. If stablecoins are allowed to pay interest, the BIS research suggests adoption could accelerate sharply. Until then, the humble savings rate remains one of the most underrated levers in global crypto adoption — a sentence nobody would have believed five years ago.
The cryptocurrency market remains highly volatile. This article is for informational purposes only and does not constitute financial advice.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.
funny how the fix for banks was sitting there the whole time, just pay actual interest. aldasoro and ahmed basically ran the control experiment from 2019 to 2025 for free
The January 2019 to June 2025 span is what sells it for me. That window has a full hiking cycle and the cuts in it, the effect holding through both directions beats any single regime result
the 1bp equals 3% slower growth line is doing heavy lifting here. the fed is basically setting stablecoin policy by accident every time it touches rates
yeah the tether crowd was never cross shopping savings accounts, apples to oranges. the rate sensitivity is a usdc and banks story, not a stablecoin story
and USDC being the most rate sensitive makes total sense, thats where the compliant money sits. nobody holding tether in 2019 was comparing it to a savings account apy
one basis point cutting stablecoin growth from 15 to 12 percent is a bigger elasticity than i expected. banks actually hold a lever here
makes sense usdc is the most sensitive one, it pays out yield now so it competes directly with deposit rates
wait, usdc pays yield now? since when? i must have missed that memo, been treating mine as dead parking in the account
yeah they rolled the yield thing out for institutional sizes, your retail parking spot still pays nothing. classic
sodium_sam asking the real questions. the memo is institutional minimums, if your usdc sits under that you are still the control group paying zero
under the minimum and outside the survey. retail experience summarized in one sentence lol
^ maybe, but 6 percent under the second method vs 12 percent baseline is a huge gap. feels like the causality work is doing a lot of heavy lifting there
the two methods bracketing the effect at 6 and 12 percent is honestly more convincing than one clean number. direction holds either way
bracketing is honest but a 2x spread between methods means the elasticity is barely identified. direction sure, magnitude eh
identified is generous. half these panels cant even agree on the substitution window, a directional result is all we get
banks competing on deposit yield instead of complaining to regulators, wild concept. took a BIS working paper to say the quiet part out loud
^ banks had the yield lever the whole time and spent years lobbying instead. the BIS paper just priced the regret
one bp on deposit rates shaving 3 percent off stablecoin growth over 10 weeks. now imagine actual rate cuts, that gap closes fast
cuts would squeeze both sides tho, banks lower deposit rates and short term treasury yield drops too. the spread is what matters and the paper barely touches it
the paper measures issuance growth, not people closing accounts. banks retaining pricing power over the pace is a very different claim than winning the war, read past the headline
fair, but issuance growth is the leading indicator. accounts close after the mint cycle ends, the BIS sample through 2025 just hasnt caught that lag yet
Issuance growth also tracks yield churn more than fresh deposits. Hard to call it money moving until redemptions line up too.