Moody’s exec warns stablecoins could erode bank market share as adoption scales

Traditional banks may face competition from stablecoins and tokenized real-world assets as these digital currencies expand beyond niche uses. While current U.S. rules prevent stablecoins from paying yield, the growth of these assets could lead to deposit outflows and reduce the lending capacity of traditional banks. Regulatory issues regarding yield-bearing stablecoins are a major point of contention between the crypto industry and banks. Efforts to bridge this gap with compromise drafts have faced resistance.