The White House Council of Economic Advisers (CEA) released a report and an interactive tool to analyze the impact of the GENIUS Act on bank lending. This law, enacted in July 2025, mandates that stablecoin issuers hold 1:1 reserves and prohibits them from offering yield to holders.
According to the CEA, banning stablecoin yield would increase total bank lending by approximately $2,1 billion, which represents 0,02% of total outstanding loans. For community banks, the projected increase is $0,5 billion, or 0,026% of their loan portfolios.
In a worst-case scenario where stablecoins capture 10% of the market, the CEA estimates total additional lending could reach $531 billion, with community banks seeing an increase of $129 billion. However, the report notes that consumers lose $800 million annually in welfare due to the yield prohibition.
The CEA calculates a cost-benefit ratio of 6,6:1 against the ban, suggesting consumer losses outweigh the benefits to banks. Banking groups, including the American Bankers Association and the Independent Community Bankers of America, dispute these findings, arguing that the model ignores the long-term risks of deposit outflows.
