Interest payments on stablecoins do not pose a threat to the banking system. This was stated by Circle CEO Jeremy Allaire during the World Economic Forum in Davos.
He described concerns about potential deposit outflows as "absolute absurdity." According to him, reward systems enhance customer loyalty, but their impact is not significant enough to undermine monetary policy.
Allaire drew a parallel with government money market funds, which have faced similar warnings about capital outflows from banks in the past. Despite this, the sector has grown to $11 trillion, and lending has not stopped.
The Circle CEO noted that the borrowing structure is already changing. Financing is shifting from banks to private lending and capital markets. These, rather than bank loans, have contributed significantly to the growth of the U.S. GDP in recent cycles.
Allaire also highlighted artificial intelligence as a key driver for the mass adoption of digital assets. Billions of AI agents will require an automated payment system. In his view, stablecoins have "no alternatives" in this niche.
A similar stance was expressed in Davos by former Binance CEO Changpeng Zhao, who emphasized the importance of using cryptocurrencies for transactions between neural networks.
Recall that in January, SkyBridge Capital founder Anthony Scaramucci explained how U.S. banks are undermining stablecoins to benefit China.