Stablecoin Growth Threatens Bank Deposits: Perp Impact

A new research note from Jefferies is drawing serious attention from institutional desks: stablecoin adoption, accelerating under the post-GENIUS Act regulatory framework, may quietly erode traditional bank deposit bases over the next five years — and the downstream effects for crypto derivatives markets are worth mapping carefully.

Jefferies Quantifies the Deposit Drain Risk

Analysts led by David Chiaverini estimate that U.S. banks could face 3% to 5% core deposit runoff over the next five years as stablecoins capture share in payments, treasury management, and cross-border settlement. That level of outflow, while not catastrophic in isolation, would likely force banks to replace lost low-cost deposits with pricier wholesale funding — translating to an average earnings headwind of roughly 3% across the sector.

The backdrop: stablecoin supply closed 2025 at $305 billion, up 49% year-over-year, while adjusted stablecoin transfer volume hit $11.6 trillion for the full year. As of early March 2026, total stablecoin market capitalization sits near $314 billion, according to DefiLlama — more than 70% above the roughly $184 billion recorded in 2022. Jefferies projects that figure could reach $800 billion to $1.15 trillion within five years.

How Does This Affect BTC and ETH Perpetual Markets?

For perp traders, the macro signal here is structural rather than immediate. A sustained migration of capital from bank deposits into stablecoin-denominated instruments — particularly DeFi lending and staking protocols offering yields above traditional savings accounts — expands the on-chain liquidity pool available to rotate into crypto risk assets.

Historically, elevated stablecoin supply growth has preceded periods of increased open interest across BTC and ETH perpetual markets. As of March 2026, a growing stablecoin float means more dry powder sitting on centralized and decentralized exchanges, capable of compressing funding rates during low-volatility regimes or amplifying long-side pressure during risk-on rotations. Traders should monitor whether the stablecoin supply expansion correlates with rising BTC and ETH open interest over the coming quarters — a pattern that has preceded multiple volatility expansions in prior cycles.

Bank of America CEO Brian Moynihan has already flagged the systemic scale of the risk, warning earlier this year about the "possibility of $6 trillion in deposits" eventually migrating into stablecoin-linked yield products. If even a fraction of that capital finds its way on-chain, the implications for perpetual market liquidity and funding rate dynamics are non-trivial.

Regulatory Guardrails Are Slowing the Immediate Threat

Jefferies is careful to note that the near-term risk is moderated by regulatory design. The GENIUS Act, passed in July 2025, explicitly bars regulated stablecoin issuers from paying yield directly to passive holders — closing the most direct path toward stablecoins functioning as deposit substitutes. A subsequent legislative effort, the CLARITY Act, is expected to further codify stablecoins as payment instruments rather than savings vehicles, which limits their appeal as yield-bearing alternatives to bank accounts.

That said, the report flags a longer-horizon risk: activity-based rewards tied to stablecoin transactions, DeFi staking, and lending protocols could replicate yield-like incentives without technically violating the yield prohibition. That structural workaround is already visible in parts of the DeFi ecosystem and represents the more credible medium-term threat to deposit bases.

Traditional Finance Is Not Standing Still

Major institutions are moving to compete directly. Fidelity Investments has launched the Fidelity Digital Dollar (FIDD), its first proprietary stablecoin. Bank of America has signaled it will issue a stablecoin contingent on Congressional authorization. Goldman Sachs leadership has publicly acknowledged deploying significant internal resources toward tokenization and stablecoin infrastructure. For perp traders, the entry of these institutions into stablecoin issuance could eventually shift the competitive dynamics of on-chain liquidity — particularly if bank-issued stablecoins gain traction as collateral in derivatives protocols.

Jefferies identifies smaller regional banks — specifically flagging WTFC, FLG, WBS, EGBN, and AX — as more exposed to deposit runoff than larger custody banks or institutions already building digital asset infrastructure. Custody banks and large institutions with existing crypto exposure may actually benefit from the transition.