What did the White House say about stablecoin yields?

A White House report found that banning stablecoin yields would have minimal impact on bank lending. It estimated only a small increase in lending if funds moved back into banks. The report argues the economic downside for users would outweigh any benefits.

How much would bank lending actually increase if stablecoin yields were banned?

The Council of Economic Advisers estimates lending would rise by about $2.1 billion. That is only around 0.02% of the $12 trillion US loan market. This suggests stablecoins are not a major drain on traditional bank lending.

What impact would this have on community banks?

Community banks would see even smaller gains from a ban on stablecoin yields. Lending at these institutions would increase by roughly $500 million, or about 0.026%. This challenges claims that stablecoins significantly hurt smaller banks.

Why are banks concerned about stablecoin yields?

Some banking groups argue that stablecoin yields attract deposits away from banks. Fewer deposits could mean less capital available for lending. However, the White House report suggests this impact is much smaller than claimed.

What is the estimated cost of banning stablecoin yields?

The report estimates a net welfare loss of about $800 million per year. This comes mainly from users losing access to yield on their stablecoin holdings. In simple terms, users would earn less without significantly helping the banking system.

What does the cost-benefit analysis show?

The report puts the cost-benefit ratio at about 6.6, meaning costs far exceed benefits. This indicates banning yields would be economically inefficient. The policy would hurt users more than it helps banks.

What is the GENIUS Act and how does it affect stablecoin yields?

The GENIUS Act, signed in 2025, already restricts stablecoin issuers from offering yield directly. However, third-party platforms like exchanges can still provide returns on stablecoins. This creates a partial workaround in the current regulatory framework.

What is the CLARITY Act and why does it matter here?

The proposed CLARITY Act could decide whether stablecoin yields are fully restricted or allowed. Lawmakers are still debating how far regulation should go. The outcome could significantly shape the future of stablecoin products in the US.

White House says stablecoin yields pose little risk

Written by Brie CarterPublished Apr. 9 2026Last Updated Apr. 9 2026

A White House report found that banning stablecoin yields would have minimal impact on bank lending while imposing significant economic costs on users.

The Council of Economic Advisers estimated that shifting funds from stablecoins into bank deposits would increase total lending by just $2.1 billion, or roughly 0.02% of the $12 trillion loan market.

“Producing lending effects in the hundreds of billions requires simultaneously assuming the stablecoin share sextuples, all reserves shift into segregated deposits, and the Federal Reserve abandons its ample-reserves framework,”

The report said.

Community banks would see even smaller gains, with lending rising by about $500 million, or 0.026%, challenging claims from banking groups that stablecoins materially reduce credit availability.

However, banning yield on stablecoins could result in a net welfare loss of around $800 million per year, as users lose access to interest-like returns on their holdings.

The findings come as lawmakers debate the scope of stablecoin regulation under the GENIUS Act, which already restricts issuers from offering yield, while leaving room for third-party platforms to provide returns.

The proposed CLARITY Act could further define whether stablecoin yields should be broadly restricted or permitted, with progress in the Senate hinging on resolving this key issue.