Coinbase Says Banks’ Stablecoin Fears ‘Ignore Reality,’ Dismisses Deposit Drain Concerns
Coinbase has accused US banks of ignoring reality by claiming stablecoins will drain deposits and constrain their ability to lend, arguing that they expand the dollar’s global reach. Policy chief Faryar Shirzad said on X that most stablecoin demand comes from outside the US, boosting dollar dominance rather than competing with domestic lenders. “The ‘stablecoins will destroy bank lending’ narrative ignores reality,” Shirzad said. “Treating stablecoins as a threat misreads the moment: they strengthen the dollar’s global role and unlock competitive advantages that the US shouldn’t constrain.” US banks have repeatedly expressed concerns that yield-bearing stablecoins will lead to large outflows from the traditional financial system, threatening lending that powers economic growth. They are urging Congress to clamp down on services that offer yields on stablecoins. Concerns intensified after US President Donald Trump signed the GENI...