The GENIUS Act will drive deposits from banks to stablecoins with higher yields, according to Multicoin Capital’s co-founder Tushar Jain. The bill prohibits stablecoin issuers from offering interest to token holders, potentially leading to $6.6 trillion exiting the banking system. Big Tech companies could compete with banks for retail deposits post-GENIUS Act.

Stablecoins like Tether and USDC offer significantly higher interest rates compared to traditional savings accounts. Interest rates on Aave for USDT and USDC are 4.02% and 3.69%, respectively, while US savings accounts average 0.40%. This competition could force banks to pay more interest to depositors.

Big Tech companies like Apple and Google are reportedly exploring stablecoins following the GENIUS Act. The stablecoin market is currently valued at $308.3 billion, with USDT and USDC leading at $177 billion and $75.2 billion. The Treasury Department predicts the stablecoin market cap to reach $2 trillion by 2028.

Read more at Cointelegraph: Stablecoin-Focused GENIUS Act Is Beginning of the End for Banks