Banks worried about losing depositors to stablecoins may already have a counterweight close at hand: the interest rate paid on a savings account.

That is the takeaway from a new working paper, "Are Stablecoins and Bank Deposits Substitutes?", published by the Bank for International Settlements (BIS), the Basel-based bank for central banks. Using weekly U.S. data covering January 2019 through June 2025, BIS economist Iñaki Aldasoro and Rashad Ahmed of the Andersen Institute for Finance and Economics examined whether stablecoins, cryptocurrencies designed to hold a stable value, function as substitutes for bank deposits. They found that stablecoin growth slows when banks raise deposit rates — a sign that the contest for customer cash between lenders and token issuers runs, at least in part, through conventional banking economics. USDC and USDT are both pegged to the U.S. dollar and rank among the largest stablecoins by market capitalization.

Stablecoin market capitalization grew by about 15% over a typical 10-week span in the sample used by the researchers. A one-basis-point increase in deposit rates, a sizable weekly move for slow-moving savings rates, cut that growth to roughly 12% under the authors' baseline estimate. Under a second method designed to isolate cause and effect, the figure fell to about 6%. Stablecoins kept growing, just more slowly.

To separate cause from coincidence, the authors relied on a quirk in bank behavior: lenders barely raise savings rates until the federal funds rate passes about 3%, after which they reprice much faster. That step-change in bank behavior gave the researchers a clean read on how deposit pricing shapes the pace of stablecoin adoption.

The link was stronger for Circle's USDC than for Tether's USDT, which the authors attribute to USDC's closer ties to U.S. users. The paper concludes that banks "retain some influence over the pace of that adoption through deposit pricing."

The findings come with caveats. Working papers reflect the views of their authors, not necessarily those of the BIS, and the sample spans a single high-rate cycle in which stablecoins paid holders no interest — a detail that bears directly on the policy questions the study raises.

The authors said regulators should weigh whether stablecoin issuers may pay holders yield, along with the trade-offs of requiring issuers to keep part of their reserves in bank deposits. Both questions go to the heart of the substitution the paper measures: each would change how directly deposit rates compete with holding tokens.

That debate is live in Washington. Banks have lobbied to keep stablecoin yield off the table, a fight that loomed over the failed Senate vote for the Clarity Act, the broader crypto market-structure bill. Meanwhile, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the Treasury Department are writing rules to implement the GENIUS Act, which takes effect in January — the rulemakings where choices like issuer yield and reserve placement will be worked out. The GENIUS Act, signed into law by President Donald Trump in July 2025, essentially legalized stablecoins in the United States and set rules of the road for their issuance, use, and custody.

The BIS has long scrutinized stablecoins and the cryptocurrency space more broadly. In 2021, it argued that the rise of blockchain-based digital dollars made central bank digital currencies more urgent, and a 2023 BIS survey warned that stablecoins could threaten financial stability if widely adopted. The new study adds to that body of research.