Stablecoin Deposit Flight Under GENIUS Act Seen as Banking Risk, Estimates Show

U.S. Treasury and Federal Reserve estimates described stablecoin-related deposit flight as a measurable risk to the banking system under the GENIUS Act, including potential impacts on deposits and bank lending. According to NS3.AI, the Treasury Borrowing Advisory Committee (TBAC) identified about $6.6 trillion in transactional deposits as exposed to migration. Federal Reserve economists estimated that a $1 trillion stablecoin-driven deposit drain, if not recycled back into banks, could reduce bank lending by $600 billion to $1.26 trillion.