🚨 BIS STUDY: Can Traditional Banks Squeeze Stablecoin Growth? 🏦📉
A groundbreaking new working paper by the Bank for International Settlements (#BIS ) has exposed a direct competitive battle between traditional bank deposits and the stablecoin market (#USDT / #USDC )! 📊⚡
🔍 THE CORE FINDING:
The study, covering data from 2019 to 2025, reveals that stablecoins and bank deposits act as partial substitutes.
Financial institutions retain significant power over digital asset adoption through one simple mechanism: Deposit Pricing! 💰📈
• The 1-Basis-Point Effect:
Researchers found that just a 1 basis point increase in U.S. bank deposit rates correlates with a noticeable slowdown in stablecoin market-cap growth over a ten-week period.
• USDC vs. USDT Sensitivity:
The substitution effect is drastically stronger for Circle’s USDC than Tether’s $USDT. Why? Because USDC is heavily tied to U.S. institutional and DeFi users who instantly rotate capital back into yield-bearing bank accounts when traditional rates spike! 💸🏛️
💡 MARKET IMPLICATION:
Since most major stablecoins pay zero interest, they face an uphill battle when traditional bank yields become too attractive. However, the game is shifting.
As yield-bearing stablecoins and tokenized money market funds gain traction, banks might lose this leverage!
#Stablecoins #TradFi #BankingSector #crypto Market
$USDC
$BTC
$ETH
A groundbreaking new working paper by the Bank for International Settlements (#BIS ) has exposed a direct competitive battle between traditional bank deposits and the stablecoin market (#USDT / #USDC )! 📊⚡
🔍 THE CORE FINDING:
The study, covering data from 2019 to 2025, reveals that stablecoins and bank deposits act as partial substitutes.
Financial institutions retain significant power over digital asset adoption through one simple mechanism: Deposit Pricing! 💰📈
• The 1-Basis-Point Effect:
Researchers found that just a 1 basis point increase in U.S. bank deposit rates correlates with a noticeable slowdown in stablecoin market-cap growth over a ten-week period.
• USDC vs. USDT Sensitivity:
The substitution effect is drastically stronger for Circle’s USDC than Tether’s $USDT. Why? Because USDC is heavily tied to U.S. institutional and DeFi users who instantly rotate capital back into yield-bearing bank accounts when traditional rates spike! 💸🏛️
💡 MARKET IMPLICATION:
Since most major stablecoins pay zero interest, they face an uphill battle when traditional bank yields become too attractive. However, the game is shifting.
As yield-bearing stablecoins and tokenized money market funds gain traction, banks might lose this leverage!
#Stablecoins #TradFi #BankingSector #crypto Market
$USDC
$BTC
$ETH
