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3h ago

Stablecoin Boom Puts Banks on Notice as Stripe CEO Says Yields Must Rise

With issuer‑paid interest barred by U.S. law, rapid growth past $300 billion alongside third‑party rewards is fueling a direct fight over depositor yields.

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‘The end of bank’s rip-off’ - Why VC thinks stablecoins will force banks to change
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Overview

  • Stripe’s Patrick Collison argued banks will have to offer market‑rate returns as yield‑bearing stablecoins scale, pointing to average savings rates of about 0.40% in the U.S. and 0.25% in the EU.
  • The GENIUS Act prohibits issuers from paying interest directly, while banking groups seek to curb rewards routed through affiliates or exchanges, a push Coinbase’s Brian Armstrong publicly criticized.
  • Stablecoin capitalization has topped $300 billion after adding roughly $52 billion since July, with PayPal’s PYUSD cited as growing 117% to $2.5 billion and offering roughly 4% in monthly rewards.
  • Stripe launched Open Issuance on Sept. 30 through Bridge to let companies create and manage their own stablecoins with minimal friction.
  • Multicoin Capital’s Tushar Jain said Big Tech could enter with higher‑yield stablecoins, as the U.S. Treasury has warned widespread adoption could trigger up to $6.6 trillion in bank deposit outflows.