The report that worries banks: Stablecoins threaten to drain billions from bank liquidity by 2028

Experts warn that stablecoins could subtract $500.000 billion from bank liquidity by 2028, despite recent volatility in the crypto market.

Macroeconomic projections point to a transformation in how capital is stored and circulated within the global financial system. This shift could redefine the role of traditional lending institutions, which face increasing competition from stable digital assets, known as stablecoins. 

A recent report by Standard Chartered warns that stablecoins could capture a significant portion of the liquidity currently held by conventional banks, with an estimated impact horizon of two years.

However, despite this structural trend, the immediate market behavior suggests that investors are maintaining a cautious stance. Santiment's analysis indicates that, although the adoption of the blockchain ecosystem continues to expand, a climate of immediate prudence persists, stemming from recent volatility. 

The apparent contradiction between long-term strategic enthusiasm and short-term operational restraint reflects the current transitional moment in the crypto sector.

The silent migration of bank money to the crypto ecosystem

Standard Chartered's research, led by Geoffrey Kendrick, offers a detailed look at how tokenizing fiat money could reshape the balance sheets of US banks. 

El reportAccording to Bloomberg, the study projects that by 2028 stablecoins—defined as digital assets designed to maintain a stable value pegged to a fiat currency like the dollar—could drain approximately $500.000 billion from bank deposits. This figure is significant, representing a third of the total $2 trillion market capitalization that analysts anticipate for this sector by the end of the decade.

The impact of this capital migration will not be uniform across the financial sector. The analysis identifies regional banks in the United States as facing the greatest exposure to this risk due to their reliance on net interest margin. This financial indicator, which measures the difference between the interest an institution earns on its loans and the interest it pays to depositors, is a vital source of income for entities such as Huntington Bancshares, M&T Bank, Truist Financial, and CFG Bank. 

Unlike large global investment banks, which have diversified revenue streams and less reliance on retail deposits, these regional institutions could see their cheap funding base eroded as users opt for the returns and operational efficiency offered by digital alternatives.

A key factor exacerbating this situation for traditional banks is the reserve management practices of major stablecoin issuers. The report highlights that entities like Tether and Circle, operators of USDT and USDC, respectively, maintain minimal percentages of their reserves in direct bank deposits. Tether holds a mere 0,02% and Circle 14,5% in conventional bank accounts. This means that the money flowing from the banking system into the crypto ecosystem does not return in the form of institutional deposits, limiting any offsetting effect and leaving banks with less liquidity available for lending. 

The reserve structure of these issuers favors Treasury bonds and other liquid instruments, thus preventing capital from returning to the traditional commercial credit circuit that feeds the real economy through regional banking.

Bitcoin and stablecoins contract under macroeconomic pressure

Despite long-term growth projections for stablecoins, recent market behavior shows that investor confidence remains fragile amid economic uncertainty. 

The on-chain analytics platform Santiment reported earlier this week a significant contraction in the stablecoin market, noting that the combined market capitalization of the top 12 stablecoins fell by $2.240 billion in just 10 days. Analysts believe this movement suggests a flight of capital from the cryptocurrency ecosystem to more traditional safe havens, contradicting investors' usual strategy of accumulating digital liquidity to profit from price declines.

The observed dynamics indicate that market participants are prioritizing liquidity in real fiat currency or the safety of commodities over exposure to digital assets. This behavior aligns with a period of high volatility during which Bitcoin underwent a severe correction. 

After trading strongly for much of 2025, the market experienced a massive sell-off on October 10, with over $19.000 billion in leveraged positions being closed. On that day, Bitcoin's price plummeted from approximately $121.500 to below $103.000, subsequently falling to around $88.000 at the time of writing. This was fueled by a global environment of monetary tightening, coupled with new tariffs on technology imports and a slowdown in international trade that reduced the appetite for risk assets.