"U.S. Genius Act to accelerate bank deposit outflows"

The U.S. stablecoin bill, the 'Genius Act (GENIUS Act),' is expected to trigger a large-scale exodus of deposits from traditional banks.

On the 6th (local time), Cointelegraph reported that Tushar Jain, co-founder of Multicoin Capital, predicted, "The Genius Act means the end of an era in which banks paid retail depositors minimal interest and pocketed the profits," and, "Big tech companies like Meta, Google, and Apple will absorb bank deposits into stablecoins by offering better yields and instant settlement."

Earlier, the U.S. Treasury had warned that large-scale stablecoin adoption could lead to about $6.6 trillion in deposit outflows from the traditional financial system.

Jain said, "Banks have already asked regulators in mid-August to block the provision allowing interest payments on stablecoins, but it will be difficult to stop the fundamental trend of change," adding, "Banks will have no choice but to raise deposit rates to remain competitive. Ultimately, profitability will deteriorate significantly."