Bank of America CEO Brian Moynihan warned that permitting interest payments on stablecoins could trigger withdrawals of up to $6 trillion.

Scale of the potential outflow

He said that such an outflow would correspond to approximately 30–35% of all U.S. bank deposits, raising concerns about liquidity and credit provision.

Why banks oppose yield-bearing stablecoins

Yield-bearing stablecoins create direct competition for bank deposits by offering returns that draw funds away from traditional accounts.

• Reserves backing yield-bearing stablecoins may be invested in government bonds rather than used for bank lending activities.
• Reduced deposit bases force banks to curtail lending or obtain more expensive wholesale funding to sustain operations.
• These dynamics could tighten credit availability for businesses and households or increase borrowing costs across the economy.

Legislative response: the CLARITY proposal

The CLARITY bill currently under consideration aims to prohibit passive yields on stablecoins while permitting rewards tied to active participation.

Under the proposal, issuers could offer compensation for staking, liquidity provision, or pledged collateral, but not for holding balances passively.