PANews reported on January 16 that, according to Cointelegraph, Bank of America CEO Brian Moynihan warned in an earnings call that interest-bearing stablecoins could siphon up to $6 trillion in deposits from the U.S. banking system if issuers are allowed to pay interest.

Moynihan, citing research cited by the U.S. Treasury Department, points out that a large amount of bank deposits may be diverted to stablecoins due to such products. He states that these products will operate more like money market mutual funds, with funds held in cash, central bank reserves, or short-term Treasury bonds rather than used for lending. He believes this deposit migration will shrink the size of bank deposits, thereby weakening credit supply capacity, particularly impacting small and medium-sized enterprises that rely more on bank loans than capital markets, and potentially driving up overall borrowing costs.