Why Does the US Still Have Stablecoin Fears?
The post Why Does the US Still Have Stablecoin Fears? appeared on BitcoinEthereumNews.com.
As the US Senate edges closer to finalizing its digital asset market structure bill, one surprisingly simple issue is holding up progress: stablecoin yield. While headlines focus on DeFi oversight and token classification, Columbia Business School adjunct professor and crypto policy analyst Omid Malekan warns that much of the debate in Washington is based on myths rather than evidence. Banks vs. Stablecoins: Are US Lawmakers Fighting a Phantom Threat? Malekan identifies five persistent misconceptions about stablecoins and their impact on the banking system I am disappointed that market structure legislation seems to be held up by the stablecoin yield issue. Most of the concerns bouncing around Washington are based on unsubstantiated myths. So I’ve written a new article tackling the 5 biggest. They include: 1) Whether stablecoins… https://t.co/U2fQcPNZyV — Omid Malekan (@malekanoms) January 12, 2026 Sponsored Sponsored According to Malekan, who has reportedly been lecturing at Columbia Business School since 2019, these misconceptions, if left unchallenged, threaten to stall meaningful crypto legislation. Myth 1: Stablecoins shrink bank deposits Contrary to popular belief, stablecoin adoption does not necessarily cannibalize US bank deposits. 🏦$6.6 TRILLION IN BANK DEPOSITS AT RISK 🇺🇸U.S. bankers warn that yield-bearing stablecoins could draw up to $6.6T out of traditional bank deposits, potentially threatening local lending. Regulators say any big shift would not happen overnight, but concerns are growing. pic.twitter.com/zoKdoVXfrm — Coin Bureau (@coinbureau) January 7, 2026 Malekan explains that foreign demand for stablecoins, coupled with the Treasury-backed reserves that issuers hold, actually tends to increase domestic bank deposits. Every additional dollar in stablecoin issuance often generates more banking activity through the buying and selling of government securities, repo markets, and foreign exchange transactions. “Stablecoins increase demand for dollars everywhere,” Malekan notes, emphasizing that reward-bearing stablecoins amplify this effect. Myth 2: Stablecoins threaten bank credit supply Critics argue…
Filed under: News - @ January 13, 2026 10:27 am