Stablecoin Regulation: BIS Finds Banks Can Compete

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What just happened: BIS research shows banks can slow stablecoin growth

A working paper from the Bank for International Settlements released on October 13, 2026, delivers rigorous empirical evidence that banks and credit unions can slow stablecoin regulation and market expansion using the oldest tool in their kit: higher deposit rates. The BIS stablecoin research lands as lawmakers scramble to build oversight frameworks, and it gives traditional institutions a data-driven argument in the bank deposits vs stablecoins debate.

The October 13, 2026 BIS working paper in a nutshell

Are Stablecoins and Bank Deposits Substitutes? (BIS Working Paper No. 1382), by Rashad Ahmed and Iñaki Aldasoro, examines weekly U.S. data from January 2019–June 2025. It asks: when banks raise deposit rates, does stablecoin demand fall? The answer is yes, materially.

According to CU Today, a one-basis-point deposit rate increase reduces stablecoin market cap growth by about three percentage points over 10 weeks. An alternative statistical method isolates the effect more cleanly, showing a reduction up to nine percentage points. That’s a meaningful dent in a market where stablecoin market cap grew an average ~15% over comparable periods.