Markets

BIS Model Shows US Deposit Rates Limit USDC Stablecoin Adoption

October 13, 2026, 11:10 PM UTC (3 hours ago) · 1 source · Summarized by CryptoBipto

A model from the Bank for International Settlements (BIS) suggests that higher US deposit rates reduce demand for USDC, a major dollar-pegged stablecoin. The research indicates that when traditional bank deposits offer competitive returns, users have less incentive to hold stablecoins that do not pay interest.

WHY IT MATTERS

Stablecoins like USDC are digital tokens designed to always be worth one US dollar. They are widely used in crypto for trading and transferring value. However, unlike a savings account at a bank, holding USDC typically does not earn you any interest. Think of it like keeping cash in a jar at home versus putting it in a savings account — when the savings account pays good interest, the jar becomes less attractive. The BIS, a major international financial institution, has now modeled this effect, showing that when US banks pay higher interest rates on deposits, fewer people choose to hold USDC. This research matters because it helps explain how traditional finance and crypto markets influence each other.

The Bank for International Settlements, often called the central bank for central banks, has published research examining the relationship between traditional US bank deposit interest rates and the adoption of USDC, one of the largest dollar-denominated stablecoins.

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