Coinbase: Banks' Concerns About Stablecoins Are Exaggerated
Date: 2025-10-31 Author: Oliver Abernathy Categories: BUSINESS
Coinbase's Head of Policy, Faryar Shirzad, noted that talk of stablecoins threatening bank lending ignores the reality: US banks hold trillions in reserves and are highly liquid. He emphasized that the majority of demand for stablecoins comes from abroad, which, on the contrary, strengthens the dollar's international standing rather than competing with US financial institutions.
Shirzad believes that stablecoins serve a role similar to money market funds, but for payments—they stimulate competition and innovation. The top executive emphasized that faster, cheaper, and programmable transactions do not threaten lending; on the contrary, banking and fintech are evolving, adapting to new conditions.
He added that stablecoin holders and traditional bank customers have little overlap, although financial institutions could use digital assets to improve their services. Viewing stablecoins as a threat is misleading: they strengthen the dollar's global role and open up new opportunities for competition.
A separate Coinbase report confirms that even if stablecoins reach $5 trillion in circulation, most of the funds will be held outside the US or locked in digital payment systems, without affecting US bank deposits. Meanwhile, US commercial bank deposits exceed $18 trillion, so the impact of digital coins on the local market remains limited, while the dollar's global dominance is only growing.
It's also worth noting that in October, Visa expanded its payment options by adding support for four stablecoins on different blockchains. This reflects the growing interest in digital assets in international trade and payment systems.
Therefore, Coinbase views stablecoins not as a competitor to the banking sector, but as a tool for fostering innovation and strengthening the dollar's global position. Their emergence creates new opportunities for financial services without threatening traditional banking and lending.
