Standard Chartered Predicts $500 Billion Shift to Stablecoins by 2028

Crypto KOL Bitwu.ETH posted on X that Standard Chartered's research report estimates that by 2028, approximately $500 billion in cash will transition from bank deposits to stablecoins. This shift is equivalent to 1% of the total deposits in high-risk countries such as Egypt, Pakistan, Bangladesh, Sri Lanka, Turkey, India, and Kenya. The report suggests that this could significantly impact banks in the coming years. Historically, bank deposits have been stable due to their role as a safe haven for funds, a payment hub, and a credit intermediary. However, stablecoins are increasingly dismantling the first two roles, with more cross-border settlements, on-chain transactions, and over-the-counter clearings bypassing traditional banking systems. Regional banks like Huntington Bancshares and M&T Bank, which rely heavily on net interest margins for over 60% of their revenue, are at a disadvantage compared to diversified banks like JPMorgan Chase and Citigroup. These regional banks leverage low-cost deposits to drive asset returns. A loss of deposits could directly increase banks' risk exposure, making liabilities more expensive and unstable. While the impact of deposit loss may not be evident during high-interest rate cycles, it could become pronounced during periods of narrowing interest rate spreads, potentially leading to bank runs.