Author: Delphi Digital, Compiler: Shaw Golden Finance

The stablecoin issuer is now the 19th largest holder of U.S. Treasuries, holding exactly the same underlying assets that back ordinary savings accounts. One of the most important issues in current cryptocurrency legislation is how these institutions are allowed to dispose of the proceeds from their national debt.

Income gap

There is a huge spread between U.S. Treasury yields and the interest rates banks pay savers on their deposits. Treasury yields remain in the 3.5%–4% range, while the average yield on regular savings accounts is just 0.39%.

Stablecoin issuers hold the same underlying assets. The GENIUS Act prohibits them from distributing proceeds directly to holders, and regulators are expanding the scope of this prohibition to include various circumvention methods that have emerged since then.

If people could hold funds that were readily cashable, free of credit risk, and earning interest, the willingness to keep cash in traditional bank accounts would decline significantly.

Critics characterize this as a national security issue. And on a practical level,it poses a threat to the fractional-reserve financing model on which the entire credit system depends.

Structural financing problems do exist

Banks rely on deposits to make loans. Private credit creation would contract if there were large inflows of dollars into fully-reserved stablecoins invested solely in Treasuries. Funds will shift to sovereign assets, and the credit transmission mechanism supporting small and medium-sized enterprise loans and consumer credit will also begin to fail.

Small and medium-sized banks and credit unions will bear the brunt. They rely much more than large institutions on deposits to support their lending operations. Once these deposits flow to the chain, they will not only lose interest rate gains, but also lose the corresponding lending ability.

This is the real contradiction at the heart of the stablecoin legislation controversy:End users have access to lower-cost, faster-moving dollars, but the credit system will lose the deposit base needed to maintain lending.

Everyone wants to be a bank

In the past few months, fintech companies and crypto companies have competed to obtain bank charter qualifications by directly applying for licenses or directly acquiring existing banks.

After the global financial crisis, the United States almost stopped issuing commercial banking licenses in the past decade. The number of new banks formed plummeted from about 132 per year to just six. When license resources are exhausted, the market no longer tries to become a bank, but instead builds a system around banks; now the situation is completely reversed.

For crypto-native companies and stablecoin issuers, a federal license means they can access the Federal Reserve’s instant payment systems FedNow and Fedwire, and directly control the clearing and settlement layer. For traditional financial technology companies, this means getting rid of dependence on third-party banks and achieving full-link vertical integration.

This convergence trend is advancing in both directions. In December 2025, the U.S. Federal Deposit Insurance Corporation (FDIC) passed a proposed rule that would allow state banks regulated by it to issue payment stablecoins through subsidiaries. In February 2026, the U.S. Office of the Comptroller of the Currency (OCC) followed suit and launched related proposed rules for national banks. Once these rules are finally implemented, any insured depository institution holding the appropriate license will have a formal channel to legally issue stablecoins.

The end of vertical integration

Stripe is the most typical case. By acquiring Bridge, Privy, Metronome, and partnering with Paradigm to build Tempo, it is building a complete payment infrastructure from stablecoin issuance to merchant settlement.

They are not alone in moving in this direction. The technical architecture of stablecoins highly corresponds to the institutional financial system:Blockchain settlement replaces the real-time gross settlement system (RTGS), stablecoin issuance replaces commercial bank deposits, on-chain liquidity and foreign exchange transactions replace agency banking, compliance logic replaces anti-money laundering (AML) infrastructure, and various payment applications are built on top of all this.

The major leading institutions in the fields of financial technology, banking and encryption are trying to control as many levels of ecological voice as possible.

Issuer risk becomes a new type of credit risk

Tether and Circle together account for more than 84% of the total market capitalization of stablecoins. The brief de-anchoring of USDC during the bankruptcy of Silicon Valley Bank has intuitively demonstrated this concentration risk. Although Circle was solvent and well-resourced, some of its funds were trapped in troubled banks and could not be accessed.

In the traditional banking system, payment risks are dispersed among various institutions, while credit risks are dispersed among the credit assets of thousands of banks. In the stablecoin system, the original settlement risk between participants is eliminated, but concentrated at the issuer level. The system does not achieve zero risk, but there is a vertical shift in risk – from dispersed counterparty exposure to highly concentrated issuer-dependent risk.

The white label stablecoin issuance business is expanding, and institutions such as Paxos, Agora, Brale, M0, and Bridge all provide issuance as a service. In the past year, Paxos has increased the market value of its issued assets by nearly 8 times by working with partners such as PayPal, who are responsible for channel distribution, and focusing on infrastructure and compliance. Although this model has been proven feasible, it has not yet shaken the status of the existing head agencies. The depth of liquidity on this scale is inherently self-reinforcing.

Conclusion

In just a few years, stablecoins have grown from niche trading tools to an important infrastructure for cross-border remittances in emerging markets. Thenext round of impact will be directed at the core financing model of the banking system itself.

The "GENIUS Act" has established a regulatory framework, and the U.S. Office of the Comptroller of the Currency (OCC) is formulating implementation details, which are scheduled to be finalized before July 2026. The key variable that remains is whether the CLARITY Act can be passed. Once approved, it will directly determine whether various platforms can provide any form of stable currency income.