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Permitting stablecoin yields could be detrimental to the U.S. banking industry and small businesses, according to Bank of America (NYSE:BAC) CEO Brian Moynihan.
“The point we’ve tried to make, and if you look at some studies, I think, were done by treasury is that they say you can see upwards of $6 trillion in deposits flow off the liabilities of a banking system … into the stablecoin environment,” Moynihan said during the bank’s Q4 2025 earnings call on Jan. 14.
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“That takes lending capacity out of the system,” he continued. “And that is the bigger concern that we’ve all expressed to Congress as they think about this, is that if you move it outside the system, you’ll reduce lending capacity of banks that particularly hurts small-, medium-sized businesses.”
Moynihan’s comments join a chorus of opposition to stablecoin yield from the banking industry.
While stablecoin legislation enacted in July bans direct interest on stablecoins, cryptocurrency asset service providers have been able to offer these incentives as rewards. Banks have called for these rewards to be prohibited in anticipated Senate cryptocurrency market structure legislation, citing deposit flight risks.
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“It is time to stand up for community banks and small businesses by making clear in market structure legislation that the prohibition on interest applies to affiliates and partners of stablecoin issuers,” the American Bankers Association said in a Jan. 5 letter to the Senate. “Anything less will put economic growth and local communities at risk.”
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The most recent draft of the Senate’s market structure bill tries to strike a middle ground by limiting rewards to activities such as staking, providing liquidity and lending. The bill was scheduled for a markup on Jan. 15 but has now been delayed following opposition from Coinbase (NASDAQ:COIN), the U.S.’s largest cryptocurrency exchange by volume. The exchange cited the amendments aimed at limiting stablecoin rewards among the reasons for its decision.
Read More: Bank Of America CEO Joins Chorus Against Stablecoin Yield, Reiterates $6T
