Bank of America Chief Warns Stablecoin Yields Could Trigger Massive Deposit Flight

In a stark assessment of digital assets' growing reach, Bank of America CEO Brian Moynihan has told lawmakers that interest-paying stablecoins could siphon trillions of dollars from traditional bank deposits. The warning was delivered during a Senate Banking Committee hearing focused on a forthcoming cryptocurrency regulatory bill.

Moynihan estimated that if stablecoins—digital tokens pegged to assets like the U.S. dollar—were widely permitted to offer yields, they could attract up to $6 trillion currently held in deposit accounts. This shift, he suggested, would fundamentally challenge the banking sector's core source of funding for loans.

The CEO's testimony enters a heated debate on Capitol Hill. The committee's draft legislation, expected soon, reportedly contains provisions that would allow regulated stablecoin issuers to pay interest to holders. Proponents argue this fosters innovation and competition, while traditional bankers see a direct threat to their financial stability.

Analysts note the comment underscores a pivotal moment. As Washington edges closer to concrete crypto rules, the tension between fostering new financial technology and protecting established systems is becoming impossible to ignore. The outcome could reshape where everyday people and institutions choose to park their cash, with billions—potentially trillions—in the balance.