On November 7, Fed Governor Stephen Miran discussed the growing influence of stablecoins on the U.S. financial system and monetary policy. Miran argued that stablecoins, largely pegged to the U.S. dollar, were already increasing demand for U.S. Treasury bills and other dollar-denominated liquid assets — a trend Miran projected to continue as adoption rises globally.
Miran cited private-sector estimates compiled by the Fed suggesting stablecoin uptake could reach between $1 trillion and $3 trillion by the end of the decade, potentially becoming too significant for central bankers to ignore. Miran discussed the potential for deposit outflows from the U.S. banking system, noting if stablecoins were purchased using funds withdrawn from domestic bank deposits, this could reduce banks’ role in the financial system and potentially disrupt how monetary policy is transmitted.
However, he noted that the GENIUS Act’s ban on stablecoin issuers offering interest makes it unlikely that stablecoins would draw significant deposits away from U.S. banks. Instead, Miran anticipated that most demand for stablecoins would stem from foreign investors with limited access to dollar-based savings options, rather than from domestic bank customers, given stablecoins provide easier access to dollar-denominated assets internationally. While acknowledging that stablecoin adoption may not reach the forecasts, Miran stated he expected continued growth, particularly outside the U.S.
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