Higher U.S. bank deposit rates were associated with slower growth in reserve-backed stablecoins, a Bank for International Settlements (BIS) study found, pointing to competition between traditional accounts and digital dollars.
Andersen Institute for Finance and Economics research economist Rashad Ahmed and BIS principal economist Iñaki Aldasoro found that a one-basis-point rise in the average U.S. non-maturity deposit rate corresponded to 2.8 percentage points less stablecoin market-value growth over the following 10 weeks. A basis point equals 0.01 percentage point.
That result came from an ordinary least squares model. A second model, intended to account for the possibility that stablecoin demand also influences deposit rates, estimated a larger difference of 9.1 percentage points over the same period. The figures come from separate statistical approaches.
The study covers 339 weeks of U.S. data, from January 2019 to June 2025. Its 10-week calculations use 324 observations after allowing for earlier data and the period needed to measure subsequent growth. Stablecoin market value rose an average of 15% over 10 weeks in the sample. Applying the two estimates to that average gives growth of about 12% and 6%, respectively; under either estimate, value would still rise.
Results also varied by asset. The ordinary least squares model associated a one-basis-point rate increase with 10-week growth that was 4.8 percentage points lower for Circle’s USD Coin (USDC) and 1.9 points lower for Tether (USDT).
Ahmed and Aldasoro propose that higher deposit returns may draw demand away from stablecoins, which generally paid holders no direct interest during the study period. The findings could help explain competition for funds between banks and stablecoin issuers, but the market-wide data do not identify individual holders’ choices. Nor do they establish that total bank deposits or lending changed.
The authors caution that their sample includes only one high-rate period, from 2022 to 2025. The stablecoin market contracted by roughly 30% during the 2022-to-2023 tightening cycle, when other adverse events also occurred, limiting what that episode alone can show about deposit rates.
