Bank of America CEO warns interest-bearing stablecoins could pull $6T from US banks

In a recent earnings call, Bank of America (BofA) CEO Brian Moynihan highlighted studies indicating that interest-bearing stablecoins could pull trillions from the US banking system. This statement underscores the potential impact of digital currencies on traditional banking and reflects changes in the financial markets. Moynihan noted that such stablecoins may become an attractive option for investors, especially in a rising interest rate environment where depositors are increasingly seeking interest-bearing assets. The attraction of yield-bearing stablecoins lies in their ability to provide quick liquidity and potentially higher returns, appealing particularly to new investor demographics. This scenario may compel traditional banks to develop new strategies to retain customer deposits, leading to increased competition. However, it also poses risks to the overall financial system that market participants must monitor carefully.