ICBA Estimates Stablecoins Could Cut Community Bank Lending by $850 Billion

A community banking group estimates widespread use of payment stablecoins could reduce community bank lending by at least $850 billion, putting a large forecast beside a federal rule on stablecoin rewards.

The Independent Community Bankers of America’s figure is a scenario estimate, not lending that has already been lost. It reflects the group’s projection of what could happen if payment stablecoins become widely used.

The White House Council of Economic Advisers (CEA) estimated in an April study that a full ban on stablecoin yields would increase bank lending by about $2.1 billion, or 0.02%. Under several extreme assumptions, the modeled increase reached about $531 billion, or 4.4%. The analyses use different models and assumptions, so their headline figures are not directly comparable.

The Office of the Comptroller of the Currency (OCC) issued its final rule Oct. 21. It preserves the prohibition on payment stablecoin issuers paying interest or yield solely because customers hold, use or retain the tokens. The rule removes a rebuttable presumption that certain arrangements between an issuer and its affiliates or third parties violate the law, leaving the OCC to assess them individually.

The change follows Comptroller Jonathan Gould’s earlier forecast for the rule’s release. Existing rewards programs do not receive automatic approval, and the OCC retains authority to enforce the ban against arrangements it considers attempts to evade it.

The rule covers qualified payment stablecoin issuers under OCC supervision and some custody operations. Foreign issuers seeking to issue in the United States must meet a U.S. regulatory equivalence determination and register with the OCC. The agency will separately announce when it begins accepting applications from nonbank firms seeking federal qualification.

Deposits, including those recorded on distributed ledgers, are excluded from the payment stablecoin definition. Tokenized deposits therefore remain bank deposits subject to banking regulation and outside the stablecoin yield ban; banks may continue paying interest on them. The OCC rule takes effect Jan. 18, 2027.