Ahmet yeniceri 
The GENIUS Act coming into effect in July is directing investors away from banks and toward high-yield stablecoins. Tech giants could enter into direct competition with banks. This law creates serious competitive pressure for traditional banking and has the potential to alter capital flows. This development is forcing banks to re-evaluate their deposit strategies and revise their interest rate policies.
Tech Giants Ready to Compete with Banks!
Tushar Jain, co-founder of Multicoin Capital, stated that the GENIUS Act has ended the era of banks collecting deposits at low interest rates. According to Jain, tech giants such as Meta, Google, and Apple are entering into direct competition with banks thanks to stablecoins’ high returns and user-friendly experience. These companies will stand out compared to traditional banking with their instant transaction and 24/7 payment advantages.
You May Be Interested In: Stablecoin Market Surpasses $300 Billion: Crypto Is Recovering!
However, the banking sector is concerned about these developments. According to Jain, tech giants like Meta, Google, and Apple are entering direct competition with banks by leveraging the high returns and user-friendly experience of stablecoins. The GENIUS Act prohibits issuers from providing direct returns. However, the law does not include a provision preventing these returns from being offered through crypto exchanges or affiliated companies. Therefore, the law allows issuers to continue providing returns through indirect methods.
The Rise of Stablecoins and Financial Risks
The U.S. Treasury Department released a report in April warning that stablecoin usage could lead to $6.6 trillion in deposit outflows. In its August assessment, the Bank Policy Institute stated that massive deposit outflows would threaten financial stability. It could disrupt credit creation, especially during times of crisis. This situation leads banks to raise interest rates, reduce credit volume, and increase costs.
Yield Differences Make Stablecoins Attractive
According to data from Stripe CEO Patrick Collison, savings accounts in the US and Europe offer low interest rates. In contrast, Tether (USDT) on the Aave platform offers a 4.02% interest rate, while Circle’s USDC offers 3.69%. This difference shows how attractive stablecoins are to investors. According to Fortune’s June report, Apple, Google, Airbnb, and X are aiming to reduce transaction fees. These companies are also exploring stablecoins to improve cross-border payments. However, no concrete steps have been taken in this direction yet.
In summary, with the GENIUS Act, there is a capital shift from banks to stablecoins. Investors will evaluate high-yield opportunities, and tech giants will become more visible in competition with banks.