Why do banks have to make stablecoins? Stablecoins not only steal payments, but also deposits I happened to study this issue a few days ago. If banks really end up, stablecoin payments can cover almost all scenarios, and the most extreme result is that deposits that originally existed in the banking system will start to be converted into US dollar stablecoins on the chain. After the stablecoin issuer receives the US dollars, they then buy short-term US bonds, reverse repos, money market funds, or bank deposits as reserves. According to the framework of the current GENIUS Act, the compliance payment stablecoin needs to make 1:1 reserves. The reserve assets can include U.S. dollars, short-term U.S. bonds, treasury bond bond repurchases and money market funds. At the same time, the issuer does not need to pay interest directly to the stable currency holders. The current deposit size of commercial banks in the United States is approximately $19.3 trillion, which is only for commercial bank deposits in the United States, not global dollar deposits, nor all cash and electronic currencies. The total size of the U.S. treasury bond bond market is about $30.9 trillion, of which Treasury Bills is only about $6.76 trillion. So if a large amount of bank deposits are really converted into stablecoins, and stablecoin issuers buy short-term US bonds, the first thing is that short-term US bonds will be sold out. Short term US bond yields will be lowered, making it easier for the US Treasury to raise funds. It can even be understood that people around the world who use stablecoins to pay are indirectly helping the US government raise funds. From "reserve assets" to "underlying assets behind payment currency", US treasury bond bonds will become more hegemonic. But it's not without pitfalls. Previously, after receiving deposits, banks mainly engaged in lending and investment businesses. Bank deposits are the liability basis for bank lending. If these deposits are transferred to stablecoins now, the stablecoin issuers are buying US Treasury bonds, not lending to businesses and households. The result is a decrease in bank deposits, a decrease in the ability of banks to create credit, an increase in credit prices, more expensive loans, and tighter credit. The Federal Reserve's own research also suggests that if domestic bank deposits are converted into stablecoins, and stablecoin issuers keep their reserves outside the banking system, US bank deposits may directly decrease. The Kansas Federal Reserve has also stated that the increase in demand for stablecoins for US bonds will essentially come from a decrease in demand for other assets, and one consequence may be a decrease in credit supply. The result is that the financial system changes from "bank deposits create credit" to "stable currency absorbs cash to buy treasury bond". On the surface, they are all in US dollars, but the underlying logic is completely different. Behind bank deposits are loans and credit expansion, while behind stablecoins are US bonds and cash equivalents. This is good for the US government, not necessarily good for banks, and may not be good for the real economy either. The US government definitely likes it, because the larger the stablecoin, the more money is spent on buying US bonds. In particular, if overseas users convert their own currencies into stable US dollars, it is equivalent to that global funds bypass the local banking system and flow directly to US dollars and US treasury bond bonds. The US fiscal deficit has gained new buying power, and the use of the US dollar globally will also expand. But banks will definitely resist, especially small and medium-sized banks. Because the biggest fear for small and medium-sized banks is not stablecoin payments, but the withdrawal of deposits. Large banks also have capital markets, wholesale financing, investment banking, and custody services, while small and medium-sized banks mainly rely on local deposits for local loans. Once deposits flow into stablecoins, small and medium-sized enterprises, agricultural loans, and local real estate loans will all be affected. It is precisely because of this that banks must launch their own stablecoins, also known as "tokenized bank deposits". This is different from payment stablecoins like USDC and USDT. Stablecoins are more like the issuer's on chain US dollar liabilities, backed by US bonds and cash. The essence of tokenized deposits is still bank deposits, but with a change in on chain accounting and transfer methods. Now Opne USD is likely to be this solution. So what banks really want to do is to put bank deposits on the chain and make payments feel like stablecoins, but the money still remains on the bank's balance sheet.